Shares in Unilever PLC (LSE:ULVR) rose and GlaxoSmithKline PLC (LSE:GSK) fell after the Anglo-Dutch group said late yesterday it was abandoning its pursuit of the GSK Consumer Healthcare joint venture after criticism from investors.
Consumer goods giant Unilever said as the markets closed it will not increase its offer above £50bn after the joint venture's owners GSK and Pfizer Inc (NYSE:PFE) argued the business was worth more.
"Unilever is committed to maintaining strict financial discipline to ensure that acquisitions create value for our shareholders," it added.
But, having made a big deal on Monday about how the GSK Consumer Healthcare offer heralded a big change of direction, the FTSE 100 group reiterated its commitment to "continuing to improve the performance of its existing portfolio through its ongoing focus on operational excellence, its upcoming reorganisation and by rotating the portfolio to higher growth categories".
Analysts said the move further fueled investor ill feeling towards Unilever boss Alan Jope, already under pressure with the shares down by around a third from just all-time high in September 2019 just after he took over.
Bernstein's Bruno Monteyne said: "No investor backs this bid. Our investor call last night was a torrent of criticism along the lines of: 'what on earth are they thinking', 'how can the board even think …', 'desperation'."