Novartis AG (NOVN.EB) said Friday that it will buy back up to $5 billion worth of shares and intends to spin off of its Alcon eye-care devices business.
The Swiss pharma major said the shareholder return will be carried out at the end of 2019 and will be largely funded with the proceeds from the sale of its consumer-health joint venture to GlaxoSmithKline PLC (GSK.LN).
Novartis said that spinning off of Alcon into a separately traded standalone company will allow the drugmaker to become more focused. The eye-care business will be publicly traded in Switzerland, Novartis said.
Alcon Chief Executive Mike Ball will become chairman-designate of the business from July 1. He is tasked with preparing the company for the spinoff and with recruiting a board of directors, Novartis said. Alcon Chief Operating Officer David Endicott will take on Mr. Ball’s role and become CEO of the business–also from July 1.
If all necessary approvals are secured, the drugmaker said it expects the spinoff to be completed in the first half of 2019.
Novartis reaffirmed its intention to pay a growing dividend, building on the CHF2.80 a share paid in March, it said.