Novartis to seek shareholder approval for Alcon spinoff

The company is also planning a share buyback of up to US$5 billion (AU$6.71 b) that is expected to occur by the end of 2019, while it will also retain Alcon’s ophthalmology pharmaceuticals portfolio.“Our strategic review examined all options for Alcon ranging from retention, sale, IPO to spinoff. The review concluded that a spinoff would be in the best interests of Novartis shareholders and the board of directors intends to seek shareholder approval for a spinoff at the 2019 AGM,” Novartis chairman Mr Joerg Reinhardt said.{{quote-A:R-W:450-Q: The spinoff is expected to allow Novartis and Alcon to focus fully on their respective growth strategies. }}“This transaction would allow our shareholders to benefit from potential future successes of a more focused Novartis and a standalone Alcon, which would become a publicly traded global medtech leader based here in Switzerland.”The spinoff is expected to allow Novartis and Alcon to focus fully on their respective growth strategies. The plan is subject to general market conditions, regulatory approvals, final board endorsent and shareholder approval in line with Swiss corporate law.The completion of the spinoff is targeted for the first half of 2019, and listings are planned on SIX, the Swiss Exchange, and the New York Stock Exchange.Mr Mike Ball has become chairman-designate of Alcon and will report to Novartis CEO Mr Vas Narasimhan in preparation for the spinoff. Should Alcon becomes an independent company, Ball is in line to become the permanent chairman of the Alcon board.“We continue to execute our strategy to focus Novartis as a leading medicines company. Alcon has returned to a position of strength and it is time to give the business more flexibility to pursue its own growth strategy as the world’s leading eyecare devices company,” Narasimhan said.“We will work to ensure a smooth transition for Alcon and Novartis associates while preparing for the launch of RTH258 and building our leading ophthalmology pharmaceuticals business.”RTH258 (brolucizumab) is considered to be a potential blockbuster medicine for the treatment of neovascular age-related macular degeneration (AMD) and diabetic macular oeda.Novartis says its ophthalmic medicines division generated sales of around US$7 billion (AU$9.39 b) in 2017.