Reckitt Benckiser Shares Plunge After Infant-Formula Verdict
By Michael Susin
Reckitt Benckiser shares fell sharply after a jury in an Illinois court sided with a plaintiff in a case relating to infant-formula Enfamil made by its Mead Johnson unit.
At 1553 GMT, shares in the U.K. consumer-goods company were down 17% to GBP43.52, putting the stock on track for its worst one-day percentage fall ever and taking it back to 2013 levels.
Reckitt--which houses Dettol, Harpic and Durex among its brands--said Friday that it strongly disagrees with the jury's decision to fault Mead Johnson and that it doesn't believe that any of its products cause necrotizing enterocolitis, a life-threatening gastrointestinal disease.
The company's statement came after it was reported an Illinois jury ordered its infant-formula unit, Mead Johnson, to pay $60 million in compensation related to the death of a premature baby who was fed Enfamil.
"We will pursue all options to overturn the verdict," it said, adding that the allegations from the plaintiff were not supported by the science.
Mead Johnson Nutrition Company was acquired by Reckitt in June 2017.
"Based on the size of this fine, the share move is massively overstating the initial impact, which suggests investors are preparing for more to come," Hargreaves Lansdown head of money and markets, Susannah Streeter, said in market comment.
Write to Michael Susin at michael.susin@wsj.com
(END) Dow Jones Newswires
March 15, 2024 12:21 ET (16:21 GMT)
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