Pfizer Spins Off Animal Health Unit, Raises $2.2B in IPO

(A. Kotok)

The pharmaceutical company Pfizer Inc. in New York created a new enterprise, Zoetis, from its former animal health division. The new company raised $2.2 billion in its initial public offering, and will trade on the New York Stock exchange under the symbol ZTS.

Zoetis, based in Madison, New Jersey, discovers and develops veterinary vaccines and medicines for both farm and companion animals. The company covers eight animal species: cattle, pigs, poultry, sheep and fish, and companion animals dogs, cats and horses. Zoetis begins with some 300 products, including vaccines, parasiticides, anti-infectives, and medicated feed additives marketed to veterinarians, livestock producers, and people who raise and care for farm and companion animals.

Pfizer says its animal health division that became Zoetis operated for 60 years. In the 2011 fiscal year that division generated $4.2 billion in revenue. Zoetis has some 9,500 employees in 70 countries, including 29 manufacturing facilities in 11 countries.

Zoetis’s IPO raised $2.2 billion from the sale of 86.1 million shares priced at $26 per share. The Wall Street Journal reports as of Friday morning, the price of Zoetis shares rose to $30.65 in its first day of trading. Pfizer will retain an 83 percent ownership of Zoetis. The Journal says the IPO is the largest in the U.S. since the Facebook IPO in May 2012.

Ian Read, Pfizer’s CEO, says Pfizer spun off Zoetis to concentrate on the company’s core biopharmaceuticals business. “For Pfizer, we are better positioned to focus on our core business as an innovative biopharmaceutical company,” says Read, “by unlocking value from the animal health business that will return value to Pfizer shareholders.”

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