Pharmecutial Business Unit Spin-Off
Challenge
After a strategic review, our client, a multinational pharmaceutical company, wanted to spin-off its US$7bn eyecare business into a separate company.
This required operational separation from the RemainCo and the build-up of new functions at the SpinCo.
At the same time, the client was also looking for support in designing the target operating model (TOM) for the SpinCo (including elements such as employee transfers, creation of new functions, transitional services, etc.)
We led the operational separation support for both ParentCo and SpinCo during the review, design, planning and execution phases. This included ‘Soft-spin' and Day 1 readiness support globally.
As part of this two-year engagement, our team became intimately familiar with the operations of one of the world’s leading eyecare companies.
Approach
We assigned a global, multi-disciplinary team to this project, consisting of functional and subject matter experts.
Through rigorous desktop research and interviews, we assessed the counterparty’s negotiation position and strategic rationale to prepare our client for the initial approach.
We advised on the TOM across different functions, including commercial and R&D, manufacturing/supply chain and overhead functions (such as IT, finance, HR, procurement, and real estate.)
We also established a central SpinCo program management office (PMO) to support transaction and operational workstreams and ensure seamless coordination across the project teams.
Benefits
With our support, the client achieved a smooth spin-off in spite of overwhelming complexity (US$28bn transaction volume).
The successful scoping and establishment of new functions meant the SpinCo was ready to function as an independent leading eyecare business as soon as the transaction was complete.