Abbott has announced plans to separate its Nutrition business into an independent, publicly traded company by the end of next year.
The Nutrition company will have approximately $8.5 billion in annual sales, with around 16,000 employees and 14 manufacturing sites around the globe.
Its portfolio covers various specialised nutrition categories including infant, pediatric, medical and adult nutrition, with brands such as Similac, Ensure, PediaSure and Glucerna.
Abbott said the separation will allow the Nutrition business to focus its resources ‘more strategically’ across innovation, commercial activities and long-term value creation and performance initiatives.
It will also enable Abbott to continue focusing on its core, higher-growth healthcare portfolio, with sales of approximately $42 billion and a range of solutions that includes wearable medical devices, diagnostics and pharmaceutical innovations.
The news comes as Abbott reduces its 2027 sales growth forecast, now expecting 6%, down from its previously forecasted 6.5%-7%.
The company’s Nutrition business has faced significant supply chain and legal challenges in recent years, including over 1,000 lawsuits alleging that the company’s cow’s milk-based preterm infant formulas contributed to serious illness in babies.
One such case saw Abbott recently agree on a settlement worth $670 million, covering a 2024 verdict in a brain damage case linking its preterm formula to necrotising enterocolitis – a severe intestinal disease primarily affecting premature infants. The company said the agreements are a compromise of disputed claims and do not constitute an admission of liability.
However, the company saw its Worldwide Nutrition sales increase by 5.1% on a reported basis in the third quarter of 2026, driven by sales growth of nearly 9% in Worldwide Pediatric.
Abbott said broad-based growth across the portfolio has fuelled sales increases in the third quarter. The Nutrition business has continued to innovate this year with ten new launches during the first half of 2026, including a new higher-protein Ensure shake and a ready-to-feed liquid infant formula with whole milk under the Similac brand.
“As we continue to shape Abbott for the future, this separation will benefit both companies, setting each one up for maximum success in its respective market,” said Robert B Ford, chairman and CEO of Abbott.
The company noted each business’ different investment identities and requirements, growth profiles, and innovation cycles. It aims to better align capital allocation strategies with the two businesses’ distinct operating models.
The separation will be carried out through a tax-free distribution to Abbott shareholders. Upon completion, Abbott shareholders will own shares in both Abbott and the newly carved out Nutrition company.
Daniel Salvadori, executive vice president and group president, Established Pharmaceuticals and Nutritional Products, will become chief executive officer of the new Nutrition company.
Abbott said the transaction, subject to regulatory approvals, will not impact its guidance for 2026 or for 2027, the latter of which it will provide in January.
Source: foodbev.com
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