Unilever today signalled it would pursue a deal for GlaxoSmithKline's consumer health business, calling it a "strong strategic fit" after its £50 billion offer was rejected, sending its shares down 6%.
GSK confirmed over the weekend that it had rejected the Dove soap maker's bid for its consumer healthcare business.
The company is home to brands such as Sensodyne toothpaste and Emergen-C vitamin supplement.
GSK shares jumped 5% in early trading today.
"The acquisition would create scale and a growth platform for the combined portfolio in the US, China and India, with further opportunities in other emerging markets," Unilever said.
It pointed to synergies in the oral care and vitamin supplements business.
GSK said on Saturday Unilever's offer "fundamentally undervalued" the business, adding that it would stick to its plan of listing the business this year.
The GSK consumer business, in which US drugs company Pfizer owns a 32% stake, has annual sales of almost £10 billion.
Unilever held talks with banks about additional financing for a potential sweetened offer for, Bloomberg News reported on Sunday, citing people familiar with the matter.
The Marmite maker, which is set to announce an initiative later this month to strengthen its business, said today it was committed to "strict financial discipline" for any acquisitions.
Unilever also said any major acquisitions would be accompanied by the divestment of lower margin businesses or brands.
