MANSFIELD – Medical technology maker Covidien PLC’s board of directors has approved the separation of its Mallinckrodt pharmaceuticals business from the rest of Covidien, the company announced Friday.
The former pharmaceuticals division will operate as Mallinckrodt PLC, run by the current division president Mark Trudeau, who will serve as president and CEO of Mallinckrodt.
Along with the approval, the board of directors also declared dividends of Mallinckrodt ordinary shares.
For every eight ordinary shares of Covidien held, the Covidien shareholders will acquire one ordinary share of the new Mallinckrodt business. No fractional shares will be issued, and shareholders will receive cash in lieu of fractional shares.
According to a Covidien release, the distribution is expected to occur on June 28 to Covidien shareholders of record as of the close of business on June 19.
After the share distribution, the Mallinckrodt pharmaceuticals business will be an independent, publicly traded company and Covidien will retain no ownership interest.
“Today’s announcement marks another important milestone toward the completion of the pharmaceuticals spin-off,” José E. Almeida, chairman, president and CEO of Covidien, said in prepared remarks. “As separate companies, Covidien and Mallinckrodt will have greater flexibility to focus on and pursue their respective growth strategies and capital needs, while potentially providing shareholders with greater value over the longer term.”
Mallinckrodt is expended to begin trading on July 1 on the New York Stock Exchange under the ticker symbol MNK. Covidien will continue to trade under the ticker symbol COV.