After scuttling plans to auction off its drug delivery tech unit two years ago, executives at Elan say they may now spin it off into a separate company. A spin-off would create two public companies and provide the drug development side of Elan extra funds to pay down debt.
Ian Hunter, an analyst at Goodbody Stockbrokers, valued the drug technology arm at about $950 million--just shy of Elan's $1 billion estimate. The drug development arm would be renamed Elan BioNeurology, the company said in a release, with the technology spin-off dubbed EDT.
"On an operating basis, both EDT and BioNeurology are now profitable," the company said in a statement put out this morning. "Each represents vastly different investment propositions, and each generates distinct and on-going capital requirements for utilization against a broad array of potential opportunities."
Elan added that it intends to carefully explore the potential of a division, noting that there is no specific timetable in mind. Separately, Elan said that it now plans to hunt for a replacement for Chairman Kyran McLaughlin, who intends to retire.
- check out the release from Elan
- here's the Bloomberg piece