Some quotes form the announcement:
Future separation
The proposed transaction is transformational to the scale of GSK's Consumer Healthcare business. Within 3 years of the closing of the transaction, GSK intends to separate the Joint Venture via a demerger of its equity interest and a listing of GSK Consumer Healthcare on the UK equity market. Over this period, GSK will substantially complete the integration and expects to make continued progress in strengthening its Pharmaceuticals business and R&D pipeline.
The intended separation of the Group will allow the two resulting companies to be established with appropriate capital structures for their future investment needs and capital allocation priorities. The new consumer healthcare company with its more durable cash flows will be able to support higher leverage levels than the GSK Group today, creating the opportunity on separation to reduce the leverage in the new Pharmaceuticals/Vaccines company
So I wonder how this will be done. Will the shares in the new JV company be given to existing share holder along the lines of receiving S32 shares from BLT (as was). Or will the JV be sold in the market and the proceeds used to reduce the pharma companies debt. I'll be unhappy with the latter.
Dividend expectations
GSK remains committed to its current dividend policy and confirms it continues to expect to pay 80 pence per share in dividends for 2018. Recognising the significance of this proposed transaction and the importance of dividends to shareholders, the company is today confirming that it expects to pay dividends of 80 pence per share for 2019.
Going forward, the proposed transaction enhances prospects for the Consumer Healthcare business and supports the development of GSK's Pharmaceuticals business. With expected improvements in both businesses, GSK expects to be well positioned to deliver returns to shareholders alongside continued investment in its strategic priorities.
So we can expect dividends to remain unchanged for another year, but my guess is once the JV is floated off by whatever means the pharma part of the company is going to pay lower dividends as it is likely to require significant investments in drug pipeline on an ongoing basis.