- Frenetic search for survivors as 91 feared dead in tornado-hit Oklahoma |
- Israel fires back at Syria after gunshots at its troops
- Drop in U.S. underground water levels has accelerated -USGS
- Convicted U.S. killer Arias would join tiny death row group
- Dollar firms before Bernanke, inflation dip hits sterling |
Pfizer names banks on animal healthcare IPO
NEW YORK, July 30 (IFR) - Pfizer Inc has appointed Bank of America Merrill Lynch, JP Morgan and Morgan Stanley to lead the IPO of its animal health-care unit, according to sources close to the situation.
The pharmaceutical company confirmed today that it expects to file preliminary documents for an IPO of the unit, named Zoetis, later this month, and hopes to complete the offering in the first half of 2013.
The IPO is part of a broader series of strategic initiatives to enhance shareholder value. Following the loss of exclusivity of its blockbuster cholesterol drug, Lipitor, Pfizer has been selling off assets and buying back stock.
In April, it agreed to sell its infant formula division to Nestle for US$11.85bn and expects to buy back US$5bn of its own stock this year.
"As we continue to work towards this potential IPO and the potential full separation, we remain open to all alternatives that would maximise the after-tax return for our shareholders," Pfizer CEO told analysts on a second-quarter earnings call this afternoon.
The comment suggests that Pfizer would be open to a strategic sale of the animal health-care unit rather than an IPO.
The company has not conducted a formal process to undertake a sale, though it did field several enquiries from interested parties since announcing plans to jettison the unit in June, according to sources.
An IPO of the unit would entail an initial float of 20% to the public, followed by a tax-free spin off of the remaining 80% to shareholders in the next year.
Zoetis could garner a valuation of $11bn in an IPO, analysts at Morningstar estimated in a research note today. Such a value would result in an immediate US$2.2bn cash infusion, and the full spin would the parent's earnings by 4% in 2013, they said.
In the second quarter, the unit generated revenue of $1.0bn, a 3% gain over the comparable year-ago period.
- Tweet this
- Share this
- Digg this