Perrigo, a global healthcare company, said that its board of directors approved a plan to separate its Prescription Pharmaceuticals (Rx) business following a previously announced strategic portfolio review.
Continuing its focus on enhancing shareholder value, the Board believes a separation of the Rx business will better enable this unique asset to capitalize on its platform of differentiated generic pharmaceutical products and allows Perrigo to focus on expanding its leading consumer business.
The Board will consider all value-enhancing options, including a possible tax-efficient separation to shareholders, a sale or merger.
The Rx business serves patients and health systems with ‘extended topicals’ medications, to treat ailments at more affordable prices.
The differentiated and diversified portfolio includes topical generic medicines in multiple dosage forms, including creams, foams, mousses, gels, liquids and inhalable products.
Perrigo board of directors chairman Rolf Classon said: “Perrigo’s Board of Directors is committed to shareholder value creation. Perrigo’s consumer and Rx platforms are both well positioned, but they are also navigating divergent industry dynamics with unique strategic, financial and operational opportunities and requirements.
“For these reasons, the Board believes the differentiated and diversified Rx business has the potential to realize greater value outside of Perrigo. After a rigorous analysis of the Rx business, we believe that fully pursuing this separation is in the best interest of Perrigo shareholders.
“We intend to begin the preparations for a separation of the Rx business to shareholders as we continue to analyze numerous value-enhancing options including a possible tax-efficient separation to shareholders, a sale or merger.”
Perrigo CEO Uwe Roehrhoff said: “Today’s announcement to separate the Rx business enables management to focus on expanding our leading consumer businesses while unlocking potential value for shareholders.
“Committing our energy and capital to the healthcare needs of consumers and our retail and pharmacy partners better positions Perrigo to drive long-term growth. We look forward to providing a comprehensive update on our consumer businesses on a conference call scheduled for September 25, 2018.”
While Perrigo has been subject to certain limitations to efficiently separate its businesses to shareholders since the acquisition of Elan Corporation plc, those limitations are set to expire in December 2018.
The separation is currently expected to be completed during the second half of 2019, which may include a tax-efficient separation to shareholders, a sale or merger, although there can be no assurances as to the form or timing of a transaction or if a transaction will be consummated.
Perrigo has engaged Barclays as its financial advisor to lead the separation process. Perrigo does not intend to disclose further developments on this process until it has determined that further disclosure is required or appropriate based on the current facts and circumstances.
Source: Company Press Release