Sanofi SA SNY has reportedly initiated talks with Rothschild & Co. to explore the possibility of spinning off its consumer health division, which could potentially value the business at over $20 billion.
In October, Sanofi announced its plans to spin off its consumer healthcare business as the French pharmaceutical company outlined its strategic update to increase investment in its drug-development pipeline and cut costs.
Sanofi said the spinoff would allow it to increase its focus on innovative medicines and vaccines.
The separation is expected to occur by Q4 2024 by creating a publicly listed entity headquartered in France.
This exploration of a spinoff has piqued the interest of prominent buyout firms, Bloomberg noted, sparking their consideration of a potential acquisition of the division.
The consumer health unit of Sanofi boasts a portfolio inclusive of popular over-the-counter products like Phytoxil cough syrups, Icy Hot pain relief gels, and Dulcolax laxative tablets.
While the discussions are in their preliminary stages, citing insiders, Bloomberg highlights that Sanofi may involve additional advisors in the future to expedite the spinoff process.
Most recently, rival pharma giants GSK Plc GSK and Johnson & Johnson JNJ split their consumer healthcare units Haleon Plc HLN and Kenvue Inc KVUE, respectively.
Price Action: SNY shares are down 0.68% at $45.42 during the premarket session on the last check Thursday.
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