Moody's affirms GlaxoSmithKline

Moody's said it affirmed the A2/(P)A2 long-term and (P)Prime-1 ratings of GlaxoSmithKline plc and its guaranteed subsidiaries.

The affirmation follows the company's Dec. 19 announcement of plans to merge its consumer health unit with that of Pfizer Inc. (A1 stable) and subsequently seek a separate listing for a new consumer health company within three years after closing the transaction.

The outlook remains negative.

“We are affirming GSK's A2 rating following its recent announcement of a consumer health joint venture with Pfizer which creates a global leader across various product sectors, and further improves GSK's profit margins. But our outlook is negative as uncertainties loom on GSK's credit profile as it progresses towards a less diversified business profile,” said Knut Slatten, Moody’s vice president and lead analyst for GSK, in a news release.

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