Mallinckrodt Officially Its Own Company, Board Approves Separation from Covidien

Healthcare products company Covidien, with a base in the City of Hazelwood has officially spun-off of its pharmaceuticals arm, Mallinckrodt plc, into an independent publicly traded company.

The board of directors has approved the separation, which will occur by means of the declaration of a dividend in specie of the pharmaceuticals business. Essentially the Pharmaceuticals business will be transferred from Covidien to Mallinckrodt. Mallinckrodt will issue ordinary shares directly to Covidien's shareholders, who will receive one ordinary share of Mallinckrodt for every eight ordinary shares of Covidien they hold.

José Almeida, Chairman, President and CEO of Covidien said the board decision is a very important step.

"Today's announcement marks another important milestone toward the completion of the Pharmaceuticals spin-off," he said. "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."

Covidien expects the distribution to occur on June 28, 2013, to its shareholders of record as of the close of business on June 19, 2013.

The Mallinckrodt name has a long history in St. Louis as it was once a chemical company used to help ionize uranium for the nation's first atomic bomb as part of  The Manhattan Project. 

The new standalone company will be one of the largest producers of bulk acetaminophen in the world, according to a Covidien statement. It will also be a leading producer of generic and branded pharmaceutical products and active pharmaceutical ingredients. Contrast agents and nuclear medicine products used in diagnostic imaging will also be manufactured at the facility.