London - British household goods firm Reckitt Benckiser (RB) has decided to spin off its pharmaceuticals division, it announced on Monday after a strategic review.
The company will float the unit, RB Pharmaceuticals, on the London stock market later this year, it said in a statement which also revealed that first-half net profits jumped by almost a quarter.
"We believe that RB Pharmaceuticals has the potential to deliver significant long term value creation as a stand-alone business," said Reckitt chief executive Rakesh Kapoor in the earnings release.
"We have therefore decided to pursue a demerger of RB Pharmaceuticals with a separate UK listing. We expect this to take place over the next 12 months.
"This will also allow RB to focus on its core strategy to be a global leader in consumer health and hygiene."
Reckitt added on Monday that group net profits surged by 23% to $1.4bn in the six months to June 30 from a year earlier, boosted partly by cost-cutting.
Revenues however dipped 7% to 4.667 billion in the reporting period, hit by adverse currency moves. At constant exchange rates, revenues grew 3%.
Reckitt Benckiser's top-selling brands include household cleaner Cillit Bang, Durex condoms and Nurofen/Nureflex pain relief tablets.
In morning deals, Reckitt shares jumped to the top of the riser's board on the London stock market.
The group's share price gained 2.96% to 5 220 pence on London's FTSE 100 index of top companies, which was down 0.04% at 6 789.15 points.