Drug giant GlaxoSmithKline (NYSE: GSK) has struck a deal to sell its drink brands Lucozade and Ribena to Japan-based Suntory as part of a strategy to focus on healthcare.

The deal, which was announced early Monday, is worth $2.1 billion.

“Lucozade and Ribena are iconic brands that have made a huge contribution to GSK over the years, but now is the right time to sell them as we increase the focus of our Consumer Healthcare business and execute the delivery of our late stage pipeline of pharmaceuticals and vaccines,” said David Redfern, GSK’s chief strategy officer.

“We believe the future of Lucozade and Ribena is in good hands given SBF’s established beverages business, ambitious growth plans and also their recognition of the strong performance and capability of the GSK employees working on these products,” he added.

GSK operates its North American headquarters in RTP. Its Stiefel subsidiary also has a major operation in the Triangle.

The transaction is expected to be completed by the end of the year.

“The proceeds will be used to reduce debt and for general corporate purposes,” GSK said in its announcement.

Suntory Beverage is preparing to spend as much as $5 billion on takeovers after holding Japan’s largest initial public offering this year. Glaxo, the U.K.’s biggest drugmaker, is selling the brands as part of a revamp announced in April to separate older products from its bigger business of developing new medicines.

“Since it’s already a known brand, they’re not going to have a problem putting it on the shelf,” said Mikihiko Yamato, deputy head of research in Tokyo at JI Asia, referring to Lucozade. “Suntory may want to start a new category within the energy drinks market,” said Yamato, who doesn’t cover the company.

Lucozade, an energy drink, and Ribena, a liquid concentrate marketed toward children, had combined sales of about 500 million pounds last year, Glaxo said. Suntory will acquire global rights to the brands and Glaxo’s Coleford manufacturing site.

The acquisition is the largest announced by a Japanese consumer company this year, according to data compiled by Bloomberg. Suntory Beverage closed 0.4 percent higher at 3,515 yen in Tokyo trading today. GlaxoSmithKline fell 0.1 percent to 1,649 pence as of 10:15 a.m. in London.

Other Plans

Glaxo said in April it was forming a new unit to house more than 50 older products with combined annual sales of about 3 billion pounds, prompting speculation it may sell the brands.

Suntory Beverage has said it plans to acquire companies in Southeast Asia, Middle East, Africa and Latin America to help double sales to 2 trillion yen by 2020. The Tokyo-based company derived about 31 percent of revenue from overseas markets last year, compared with 25 percent in 2011, according to data compiled by Bloomberg.

The acquisition would allow the Japanese company to expand in countries where the U.K. company already operates, such as Nigeria and Malaysia, Suntory said.

Suntory aims for 5 percent annual sales growth in the brands which the company expects would provide “stable profits,” Chief Executive Officer Nobuhiro Torii said at a media briefing in Tokyo today.

Suntory was advised by Morgan Stanley and Glaxo worked with JPMorgan Chase & Co. and Greenhill & Co.

Orangina Purchase

The drinks maker began trading July 3 after raising almost $4 billion in the nation’s biggest share sale since Japan Airlines Co.’s 663 billion yen initial public offering in September last year.

Suntory Beverage, which sells Boss coffee, bought 51 percent of PepsiCo Inc.’s soft-drink business in Vietnam this year.

Parent Suntory Holdings, which sells whiskey and beer, remains unlisted. The beverage group bought France’s Orangina Schweppes Group for 300 billion yen in 2009 and paid 600 million euros in the same year for New Zealand’s Frucor Beverages Group.

Suntory Holdings had a 20 percent share of Japan’s non- alcoholic drink market in 2012, the second-biggest after Coca- Cola Co.’s 28 percent, according to Inryosoken, a research company.

Suntory Beverage almost doubled first-half net income to 12 billion yen after it pared costs and sales in Asia rose, the company said Aug. 6.

Suntory is known for its slogan “Yatteminahare,” or “Go for it,” created by founder Shinjiro Torii. Actor Bill Murray’s character in the 2003 film “Lost in Translation” introduced the company to international filmgoers with the line, “For relaxing times, make it Suntory time.”

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