Novartis had singed a contract with British pharmaceutical group GlaxoSmithKline (GSK) to acquire GSK's oncology business for $14.5 billion (10.5 billion euros), the Basel-based Swiss drugmaker announced Tuesday.

Under a separate deal, GSK had agreed to buy Novartis' vaccines business, excluding flu, for $7.1 billion plus royalties, Novartis said. Moreover, the two companies had founded a joint venture in the consumer health care segment, it added.

Part of the overhaul of Novartis business portfolio was also the divestment of the company's animal health division, which would be sold to US medical company Ely Lilly for about $5.4 billion. The spin-off was expected to be completed by the end of the first quarter of 2015, Novartis said, while the deals with GSK should be finalized in the middle of that year.

Novartis Chief Executive told reporters that about 15,000 employees would be affected by the reorganization, and that the transaction was intended to boost innovation and raise profits.

“They improve our financial strength, and are expected to add to our growth rates and margins immediately,” he said.

In 2013, the Novartis CEO announced plans to restructure the firm's business portfolio in efforts to boost returns to the company's shareholders.

GSK said its restructuring was aimed at creating a more balanced business centered on consumer health, vaccines, respiratory and HIV medicines, which would account for about 70 percent of the company's revenues.

uhe/hc (Reuters, AP, dpa)