Merck to Focus on Key Growth Pillars Through Spinoff of Women’s Health, Trusted Legacy Brands and Biosimilars Products into New Company (“NewCo”)
NewCo to be a Leading Women’s Health Company; Represents Total Revenue of Approximately $6.5 Billion for Merck in 2020
- Separation to enhance focus of both Merck and NewCo to better meet the needs of their patients and customers and achieve faster growth and greater value for all stakeholders
- Merck to benefit from strong growth across its current pillars of Oncology, Vaccines, Hospital and Animal Health, while aspiring to be the premier research-intensive biopharmaceutical company
- Transaction enables Merck to achieve in excess of $1.5 billion in operating efficiencies by 2024; targeting Non-GAAP operating margin greater than 40%
- NewCo will pursue global leadership and sustainable growth in Women’s Health; will realize full potential of its trusted Legacy Brands and rapidly expanding Biosimilars products
- Merck to retain its dividend of $2.44 per share post separation and anticipates future increases with the goal of achieving a 47% to 50% payout ratio over time; NewCo expected to pay an incremental dividend
- Transaction intended to be completed in the first half of 2021
KENILWORTH, N.J.–(BUSINESS WIRE)–Merck (NYSE: MRK), known as MSD outside the United States and Canada, today announced its intention to spin-off products from its Women’s Health, trusted Legacy Brands, and Biosimilars businesses into a new, yet-to-be-named, independent, publicly traded company. The spinoff will allow both management teams to drive increased responsiveness to the particular needs of their patients and customers and achieve faster growth through focused and fit-for-purpose operating models.
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