Kimberly-Clark to Spin Off Healthcare Business

Kimberly-Clark said Tuesday that it has formally filed with the SEC to spin off its healthcare unit. The new company, Halyard Health, will be headquartered in Alpharetta, Ga.

When the spin-off is completed later this year, Halyard will be a stand-alone public company traded on the New York Stock Exchange, Kimberly-Clark said.

Kimberly-Clarks’ healthcare division makes products to treat hospital-acquired infections, surgical products and products for digestive health and pain management. According to the company, the unit generates about $1.7 billion in annual net sales and employs 16,500 employees worldwide.

"Our new direction as an independent company is focused on advancing the health of patients and our industry by delivering clinically superior solutions for preventing infection, eliminating pain and speeding recovery," Robert E. Abernathy, future chairman and CEO of Halyard Health, said in a statement.

The spin-off will include a tax-free distribution of 100 percent of Halyard Health's common stock to Kimberly-Clark shareholders. A distribution ratio will be determined shortly before the spin-off occurs. To repurchase its common stock, Kimberly-Clark will receive a cash distribution from Halyard Health prior to the spin-off, the Dallas-based company said. — Kellen Owings

Subscribe to Devices & Diagnostics Letter for complete coverage of the medical devices industry. Click here for more information.