Pfizer (PFE) generated a lot of buzz last year when it announced it was considering strategic options for several of its units. Its nutrition business has since been sold to Nestle for over $11b in cash and this week will bring about the IPO carve out of its animal health division, now known as Zoetis. The animal health company will begin trading Friday under the ticker ZTS and the offering is expected raise over $2b, making this the largest offering since Facebook (FB). Pfizer will retain ownership of Zoetis’ Class B shares, good for ~80% of the company and could possibly spin this stake off to shareholders at a later date (this site surely hopes so!). The Deal Pipeline has a good summary of the entire transaction. According to Marketwatch, word on the street is that Zoetis is receiving heavy demand from investors and is expected to be oversubscribed. Not bad!
Pfizer recently reported solid earnings and is expected to use the proceeds to raise its cash balance for buybacks. Those hoping for some corporate followers were disappointed when Eli Lilly (LLY) CFO Derica Rice said that the company had no plans to divest its own animal health unit, Elanco. Oh well.
We will keep you updated on this situation if it progresses and click here for all of our previous coverage of the Pfizer saga.
Disclosure: Author holds no position in any stock mentioned.