Novartis AG agreed to buy GlaxoSmithKline Plc’s cancer-drug business for as much as $16 billion, form a consumer-health venture with Glaxo and sell its animal-health unit to Eli Lilly & Co. for $5.4 billion in an overhaul of the Swiss drugmaker.

Novartis also will sell its vaccines business, excluding the flu operations, to Glaxo for $7.1 billion, the Basel, Switzerland-based company said in a statement Tuesday. That includes royalties and as much as $1.8 billion payments based on the achievement of certain business goals.

Executives “talked to virtually everyone” as they searched for a way to rejuvenate Novartis and leave it better equipped to face industry challenges, said Chief Executive Officer Joe Jimenez. The multiple transactions undo much of the legacy of former Chairman and CEO Daniel Vasella, who built the company into a health conglomerate over 17 years.

“So in the next 10 years, we’re in fighting condition,” Jimenez said in an interview with Bloomberg Television. “You have to be No. 1, No. 2 or No. 3 in your segment. This was so critical we talked with virtually everyone.”

Novartis climbed 2.6 percent to 76.65 Swiss francs at 9:05 a.m. in Zurich, while Glaxo advanced 4.2 percent to 1,624 pence.

Glaxo and Novartis’s consumer-health venture will have about 6.5 billion pounds ($10.9 billion) in revenue, Glaxo said. Glaxo will have majority control, with an equity interest of 63.5 percent. The venture brings together brands including Novartis’s Excedrin painkiller and Glaxo’s Sensodyne toothpaste. Glaxo’s vaccines purchase will add Bexsero for meningitis to its Cervarix for human papillomavirus. “Opportunities to build greater scale and combine high-quality assets in vaccines and consumer health care are scarce,” Glaxo CEO Andrew Witty said in a statement. “With this transaction, we will substantially strengthen two of our core businesses and create significant new options to increase value for shareholders.”

Glaxo said the transaction will probably be completed during the first half of 2015 subject to approvals. Novartis will begin to seek a buyer immediately for the flu-vaccine business. Excluding that operation from the deal with Glaxo will help Novartis get the most value for it, Jimenez said.

Lilly said its purchase creates the world’s second-largest animal-health company as it absorbs the Novartis business, which had 2013 sales of about $1.1 billion. The Indianapolis-based drugmaker said it will take on about $2 billion of debt and pay the rest with cash on hand. Lilly expects annual cost savings of about $200 million within the third year after the deal is completed.

BofA Merrill Lynch advised Lilly, while Goldman Sachs Group Inc. advised Novartis on the animal-health deal. Glaxo said Lazard and Zaoui & Co. are acting as joint financial advisers. The U.K. company has also received financial advice from Citigroup Inc. and Arkle Associates. Lazard and Citigroup are acting as joint sponsors for the transaction, Glaxo said.

Novartis began a strategic review of animal health, vaccines and consumer health last year because the units were too small. Jimenez said the company wanted to be the leader in its businesses or it would consider selling them. Novartis’s bigger operations include prescription drugs, the Sandoz generic-pharmaceuticals unit and the Alcon eye-care operation. (Bloomberg)