Sulzer May Split into Two Companies

At its annual press conference, Sulzer (Winterthur, Switzerland; www.sulzer.com) presented the possibility of separating Sulzer and Sulzer Medica into two separate companies. A final decision will be made at the company's annual general meeting in April. The contemplated move is Sulzer's response to the attempts of InCentive Capital AG to seek control of Sulzer's board and an attendant public tender offer by InCentive, which Sulzer says is unacceptable because it undervalues the industrial businesses and offers no clear strategy.

Sulzer Medica, with its core businesses focused on orthopedic, cardiovascular, and biotechnology products, would form one of the new independent companies. The recent acquisition of IntraTherapeutics (peripheral stents) and Paragon (dental implants) have strengthened the company.

The second company, the new Sulzer Corporation, would focus only on industrial products and services. Core businesses include Sulzer Metco, Sulzer Turbomachinery Services, Sulzer Pumps, and Sulzer Chemtech. A divestiture program for noncore businesses is already underway.

"Although synergies will naturally be exploited, our chief priority is to ensure that each core business activity is competitive in its own right and generates shareholder value,” said Fred Kindle, CEO of Sulzer.



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