On June 3, 2021 Merck (NYSE: MRK), known as MSD outside the United States and Canada, reported it has completed the spinoff of Organon & Co. (Organon) (Press release, Merck & Co, JUN 3, 2021, View Source [SID1234583457]).
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"Today marks a significant milestone for both Merck and Organon. Organon is now an independent, publicly traded company with a broad portfolio of important medicines and products, and is fully prepared to deliver sustainable growth and value," said Rob Davis, president, Merck. "With leadership in our growth pillars and our robust pipeline, Merck is well positioned for strong long-term growth, with scientific innovation remaining the source of our value creation."
Merck’s goal with the spinoff was to create two patient-focused companies with enhanced strategic and operational focus, improved agility, simplified operating models, optimized capital structures and improved financial profiles. Merck believes the transaction will deliver significant benefits for both Merck and Organon and create value for Merck shareholders. The spinoff is expected to allow Merck to increase its focus on key growth pillars, achieve higher revenue and EPS growth rates and enable incremental operating efficiencies of approximately $1.5 billion, which are expected to be achieved ratably over three years, with approximately $500 million realized during 2021. In connection with the spinoff, Merck received a distribution from Organon of approximately $9 billion.
Organon did not issue fractional shares of its common stock in the distribution. Instead, holders of Merck common shares received cash in lieu of any fractional shares of Organon common stock that they would have otherwise been entitled to.
Shares of Organon will be listed and commence trading today on the New York Stock Exchange under the symbol "OGN". Shares of Merck will continue to trade under the symbol "MRK".