Thursday, December 16, 2021
Billions in price maintenance
Novartis launches a pampering program for shareholders
After decades, the pharmaceutical giants Roche and Novartis are loosening their ties. This brings Novartis a double-digit billion amount into the coffers. A large part of the money should now benefit the shareholders.
The Swiss pharmaceutical giant Novartis wants to pay out the majority of the proceeds from the sale of its billion-dollar block of Roche shares to its shareholders. The pharmaceutical company from Basel announced a new share buyback program with a volume of up to 15 billion dollars. The company has the flexibility to return money to its owners thanks to strong operational business performance, earnings growth prospects and the proceeds from the sale of its Roche stake, Novartis said.
The move was made “without restricting the company’s ability to value-adding mergers and acquisitions, while paying a strong, growing dividend and reinvesting it in the company,” it said.
As the Swiss pharmaceutical manufacturer also announced, it expects average annual sales growth of at least 4 percent through 2026. There are up to 20 products in the pipeline with significant sales potential.
The buyback of own stocks is to be implemented by the end of 2023. Novartis and Roche had recently broken their unusual ties after two decades. Roche bought almost a third of Roche’s voting bearer shares for around $ 21 billion.