2 July 2018 - Deborah Wilkes
Novartis plans to spin off its Alcon eyecare devices division into a separately-traded standalone company with 2017 sales of around USD6.7 billion.
The Swiss company said a strategic review had concluded that a 100% spin-off was consistent with its "strategy of focusing as a medicines company" and was in the best interest of shareholders.
Novartis announced in January 2017 that it was considering “all options” for its under-performing Alcon division “ranging from retaining the business to separation via a capital markets transaction such as an Initial Public Offering (IPO) or spin-off".
In October 2017, Novartis said the strategic review had indicated that a stand-alone company formed through a “capital markets exit” could create additional shareholder value (click here to read the News story).
Novartis said the spin-off required final board endorsement and shareholder approval at the Annual General Meeting in February 2019. The transaction should be completed in the first half of 2019, added the company.
Alcon's ophthalmology pharmaceutical portfolio will remain with Novartis.
Alcon's OTC portfolio
The Alcon eyecare devices division houses a number of OTC products including the ICaps and Vitalux vitamins, minerals and supplements (VMS) ranges; Systane products for dry eyes; and Zaditor antihistamine eye drops. Novartis said the dry eye and ocular health products had sales of around USD0.7 billion in 2017.
The division also markets contact lenses and contact lens care products with 2017 sales of around USD2.3 billion.
Alcon's chief executive officer Mike Ball has been appointed chairman designate of Alcon with effect from 1 July 2018. Chief operating officer David Endicott has been promoted to chief executive officer.
Novartis said Alcon would have its headquarters in Switzerland, with Fort Worth in the US continuing to be a key location. Listings are planned on the SIX Swiss Exchange and New York Stock Exchange.
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