Earlier reports suggested that Mead Johnson, which might be sold by its parent company, US-based Bristol-Myers Squibb. Yesterday relevant parties of its Chinese branch made their first response. Chen Xiaomin, the director of external affairs at Mead Johnson Nutrition (China) Co., Ltd., told reporters yesterday that BMS has completed its related assessment work on Mead Johnson. "The latest plan is to spin off Mead Johnson from BMS and list it independently. It is expected that by the end of this year, registration application can be submitted to the relevant securities regulatory authorities in the United States."
Previously, there were reports that Bristol-Myers Squibb intended to sell its entire Mead Johnson baby formula business, with an estimated sale value between $7 billion to $9 billion. It was rumored that companies including Danone, Nestle, Kraft, Heinz, as well as Johnson & Johnson and GlaxoSmithKline could become potential buyers. In response, Chen Xiaomin stated yesterday that after completing the overall strategic assessment, BMS recently made the latest decision to separate the Mead Johnson business and conduct an IPO in the US, publicly offering no more than 20% of its shares to the public, while BMS will hold at least 80% of the shares as its investment in the Mead Johnson business. "There may still be some uncertain factors in the details, but the general direction is basically like this." Regarding why the final decision of the parent company differs from the previous rumors, Chen Xiaomin did not provide a response. However, he believed that compared to other options, the current plan is more conducive to promoting the rapid development of the company's business.
Some industry insiders believe that in recent years, some pharmaceutical companies like Novartis and Pfizer have tended to sell non-core businesses such as nutritional products, focusing their efforts on prescription drug businesses. However, in fact, infant formula has very large development potential in emerging markets like China, even surpassing some currently competitive, market-saturated developed countries. It was revealed that in 2007, Mead Johnson's global sales reached $3 billion, while its sales in China reached 1.6 billion RMB. "BMS's final decision to retain most of the equity in the Mead Johnson business should be closely related to its excellent performance, including its development in China." In fact, another well-known American pharmaceutical company, Wyeth, also announced earlier this year its intention to significantly increase its investment in infant formula and other nutritional product businesses in China.