Pfizer: Here’s Our Stock Buyback Plan
Pfizer’s (NYSE:PFE) attempts to focus on new drug development are leading it to offer an initial public offering of its animal health unit. A decision on how the drug maker will let go of the business has not yet been made, the company said. Chief executive officer Ian Read said the IPO will be followed by an exchange of shares in the new business with current company stockholders.
“We’re probably going to exchange, part of it will be sold for stock in the open market, part of it will be swapped for Pfizer shares,” Read announced on Thursday.
The unit earned $4.18 billion in revenue last year. A share exchange will help bring down Pfizer’s own share count, and help boost earnings per share and dividend coverage.
Last year, Pfizer lost its patent protection for Lipitor, a cholesterol drug that generated $9.58 billion in revenue. The company has been trying to fill in for the new revenue hole by working on new drugs and shedding units.
Pfizer had also announced earlier this week that it was selling its infant nutrition business to Swiss company Nestle for $11.9 billion. Read wants to cut another $1 billion from the company’s informational and administrative costs this year. The world’s biggest drugmaker will report first-quarter earnings on May 1.