Healthcare: At a Glance - Boots OTC brands set for new owners

Boots put its over-the-counter drugs business on the auction block four months ago. What's new?

Prospectuses have now been sent to parties interested in a deal, Boots head of financial media relations Donal McCabe tells us. A hotly contested battle is expected among bidders for the business. But there is no definite timescale for the sale of Boots Healthcare International (BHI), the division that produces the OTC brands.

How significant is this deal?

Crookes Healthcare, a subsidiary of BHI, is one of the biggest OTC suppliers in the UK and markets 130 OTC products worldwide.

Why does Boots want to sell BHI?

Money. Boots has issued several profit warnings recently and has decided that BHI, which is in the final year of a four-year growth plan, is no longer a core business. For Boots as a whole, like-for-like sales are down this year and shareholders are looking for some cheer. Last year BHI made an operating profit of £85m on sales of £520m. Estimates have suggested that the sell-off could fetch more than £1bn.

Boots' in-house comms team hasn't had the easiest of times in recent years, has it?

Indeed not. Since 2003, Boots has shed half of its communications team across the business, losing 40 or so posts, as part of restructuring. For those who remain there are plenty of communications challenges, with issues such as price and product competition from supermarkets affecting the OTC brands.

Does the firm use agencies to promote the unwanted OTC brands?

Yes. Hill & Knowlton continues to handle PR for Strepsils throat sweets, painkiller Nurofen, the E45 range of emollients and the Clearasil spot removal treatment. It is a significant account for the agency's London office, whose remit on various Crookes brands was extended four years ago (PRWeek, 9 February 2001). Another agency, The SPA Way, also does project work on Clearasil.

Given the planned sell-off, what's the latest on the PR campaigns? Have they been disrupted?

It's very much 'business as usual', the client insists. Victoria Simons, head of PR for BHI, says: 'We are running great campaigns and are happy with the agencies. We have no thoughts of changing.'

Further information www.boots-plc.com.

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