The chairman of Swiss drugmaker Novartis Alcon to be valued at between $20 billion and $30 billion when the opthalmic devices unit is spun off to shareholders next year, he said in an interview with Finanz und Wirtschaft. "Just how much it's ultimately going to be will be determined when we know how debt and other things will be quantified," Joerg Reinhardt told the Swiss financial newspaper.
Novartis announced on Friday it is spinning off the eye care surgical equipment and contact lens unit, with $7 billion in annual revenue. The business no longer fits the drugmaker's strategy of focusing on prescription medicines, Novartis concluded. The Basel-based company will also repurchase up to $5 billion in shares through the end of next year. Reinhardt said it was hard to determine whether Alcon, bought over time for $52 billion from Nestle in a deal concluded in 2011, ever really earned money for Novartis.
"Tough to say, since Alcon had to be revamped multiple times," he said. "But I would say, all things considered, we didn't lose money on Alcon." Reinhardt also said there were no changes to Novartis's roughly $13 billion stake in Roche. His company has, for now, abandoned active plans to unload the package, and Reinhardt has returned to calling it "a financial investment with a certain strategic component."
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