ZURICH (Reuters) -Novartis said on Thursday it would spin off Sandoz and list the biosimilars unit on the Swiss stock exchange to create the No.1 European generics company and a more focused parent group.
“For both the innovative medicines and Sandoz businesses, the spin-off would enable enhanced focus and the ability to pursue independent growth strategies,” the Swiss pharma group said in a statement.
A standalone Sandoz would be headquartered in Switzerland and listed on the SIX Swiss Exchange, with an American Depositary Receipt programme in the United States, Novartis said.
The transaction, which is expected to be generally tax-neutral for Novartis, is expected to be completed in the second half of next year, subject to market conditions, tax rulings and opinions, final board endorsement and shareholder approvals, Novartis said.
“A spin-off would allow our shareholders to benefit from the potential future successes of a more focused Novartis and a standalone Sandoz, and would offer differentiated and clear investment theses for the individual businesses,” Chairman Joerg Reinhardt said in the statement.
“Sandoz would become the publicly traded #1 European generics company and a global leader in biosimilars based in Switzerland,” he said.
Sandoz generated $9.6 billion sales in 2021, but Novartis said last month its earnings would likely be flat this year rather than declining.
Novartis is currently executing a restructuring programme that involves cutting up to 8,000 jobs, or about 7.4% of its global workforce.
(Reporting by Silke Koltrowitz; Editing by Clarence Fernandez and Sherry Jacob-Phillips)
