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Company to hold onto surgical drapes and gowns business
October 2, 2008
By: Karen McIntyre
Editor
Cardinal Health has announced plans for a tax-free spin-off of its clinical and medical products businesses as a separate public company which will be led by current vice chairman and med-tech industry veteran David Schlotterbeck.As a result of the spin-off, which is anticipated to be completed by the middle of calendar 2009, both companies are expected to benefit from enhanced management focus and sharper strategic vision, as well as better alignment of management and employee incentives with performance and growth objectives. In addition, both companies expect improved opportunities to access and allocate capital, and the ability to make investments in their respective growth areas. CEO R. Kerry Clark, 56, will continue to lead Cardinal Health through the spin-off and then will retire from the company. He will be succeeded by George S. Barrett, 53, who has served as vice chairman and CEO of Healthcare Supply Chain Services since joining Cardinal Health in January and has more than 25 years of experience in the health care industry, most recently serving as president and CEO of North America for Teva Pharmaceuticals and as a member of Teva’s Office of the CEO. In addition to his responsibility for North American operations, he led Teva’s global pharmaceutical strategy. Founder Robert D. Walter will retire from its board of directors by not standing for re-election when his term expires on Nov. 5, following the company’s 2008 annual meeting of shareholders. He will continue to serve as an adviser to the company. The spin-off of the clinical and medical products businesses will create a new, global company headquartered in San Diego, CA with industry-leading offerings for infusion, medication and supply dispensing, respiratory care, infection prevention, medical diagnostics and surgical procedures. Following the spin-off, Cardinal Health will retain its industry leading surgical gloves, drapes and apparel, and fluid management businesses which are currently part of the Clinical and Medical Products segment. Cardinal Health also will retain a group of other businesses including Pharmacy Services (outsourced hospital pharmacy management services) and Medicine Shoppe International, while the company conducts a previously announced in-depth review to evaluate their strategic fit. Cardinal Health will continue to be headquartered in Dublin, Ohio.
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