Novartis completes divestment of medical nutrition operations

Novartis has this week completed the divestment of its medical nutrition segment, with the sale of the unit to Nestle for a total sum of $2.5 billion (1.25 billion pounds).

This move is part of the company’s continuing divestment programme which is part of its long-term strategy to focus exclusively on healthcare, with pharmaceuticals at the centre of all operations.

Following the receipt of regulatory approval, 2,000 employees from the medical nutrition segment at Novartis have joined the Nestle group, with the unit set to complement that company’s existing healthcare nutrition business.

“After these divestments, all Novartis businesses activities will be concentrated on healthcare, areas where the Group has expertise and synergies in addressing the needs of patients and customers,” the company reports.

It adds that these areas include pharmaceutical treatments for animals and humans, generics, vaccines, over-the-counter brands and diagnostic products.

The final part of Novartis’ divestment programme is due to be completed later in 2007, with the announced sale of Gerber baby foods – also to Nestle – for $5.5 billion.

In July 2006, Novartis reported that it has no interest in merging with rival pharmaceutical firm AstraZeneca, despite speculation that it could be a potential buyer for the company.