Novartis announced that Alcon, the eye care division of Novartis, will spin off to become a standalone company in an aim for the former to focus on growth.
Peter Zuest, Novartis’ global media communications told us, “Alcon strategic review concludes that 100% spinoff is in the best interest of shareholders and consistent with the Novartis strategy of focusing as a medicines company.”
He further explained that Alcon’s pharmaceuticals portfolio will remain with Novartis.
Following its spinoff, Alcon will move its headquarters to Geneva, Switzerland with its Europe, Middle East, and Africa regional office. The planned move will occur in 2019.
The Geneva office will be used as a hub for corporate leadership with commercial functions, with close proximity to international transport links was a factor in the decision, according to Zuest.
Alcon’s current headquarters in Fort Worth, Texas will remain for the proposed standalone company.
Alcon’s new location could add more employees after spinoff is finalized. “In Switzerland as a whole, there are approximately 650 employees across sites in Fribourg, Geneva, Rotkreuz and Schaffhausen. While the final details are being worked out, the Alcon group could employ up to 700 people in Switzerland,” said Zuest.
The listed holding company for the Alcon group will be incorporated into the Canton of Fribourg site in Switzerland, where Alcon has significant operations already established.
Per the spinoff from Novartis, Alcon will trade on the SIX Swiss Exchange as well as the New York Stock Exchange. Alcon is expected to be a standalone company in 2019.
Growth strategies and Novartis
The planned spinoff was announced by Novartis as an opportunity to work towards individual growth strategies.
We’ve reported that Novartis has completed sell-offs of its divisions as of late. Within the past week, we reported that Novartis sold off its dermatology division Sandoz to Aurobindo in a $900m deal.
Novartis also said it would sell its $13bn stake in a joint healthcare venture to its partner GlaxoSmithKline (GSK) to further invest in its own core businesses. Prior to this, the comapny also released plans to free-up resources by no longer pursuing antibiotics R&D.