Pfizer Plans to IPO Part of its Animal Health Segment
Pfizer Inc. (NYSE: PFE) is in the process of an IPO for a minority share in a sector of the company's animal health business, that they plan to name Zoetis. According to Pfizer, "The Animal Health unit includes products and services to prevent and treat disease in livestock and companion animal." Pfizer is historically known as one of the biggest research based pharmaceutical companies, and by making Zoetis a stand-alone company, Pfizer can now focus on human pharmaceuticals.
In a press release earlier today Pfizer stated: "With more than 9,000 employees, the business markets its products in more than 120 countries with operations in developed and emerging markets and provides comprehensive animal health solutions to veterinarians and the livestock farmers and companion animal owners they support.”
“The business has an extensive research and development network and holds leading market positions across major geographic regions, including North America, Europe, Africa, the Middle East, Latin America, and Asia-Pacific. Revenues in 2011 were approximately $4.2 billion."
Pfizer plans to file IPO-registration documents later this summer. Competitors of Pfizer's animal health unit include Novartis AG (OTN: NVSEF) and Merck & Company's (NYSE: MRK) animal health unit. In 2011, Merck & Co.'s animal health unit had product sales of $3.3 billion. Earlier in the year, Novartis had made a bid for the division, valuing it at about $16 billion.
In a Forbes article, Zoetis has been valued by ISI Group analyst, Mark Schoenebaum, at about $15 billion. Schoenebaum went on to state that if Pfizer sells 20% of Zoetis in the IPO, it could raise $3 billion in cash. Pfizer plans to use the proceeds to repurchase shares.
The percentage of Pfizer's stake that the company plans to sell at the IPO was not yet specified, but there is expected to be more detail after the second-quarter reports.
Pfizer closed on Wednesday at $21.91, and is now trading near $22 with a market cap of around $165 billion.
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