The distribution of shares of CareFusion common stock will be made after the close of trading on August 31, 2009 to Cardinal Health’s shareholders of record as of 5 p.m. EDT on August 25, 2009, the record date for the spinoff. Cardinal Health will distribute 0.5 share of CareFusion common stock for each common share of Cardinal Health outstanding as of the record date. Shareholders will receive cash in lieu of fractional shares of CareFusion common stock.
The board voted to approve the spinoff after concluding that, as separate companies, both Cardinal Health and CareFusion will benefit from enhanced management focus and sharper strategic vision, as well as improved opportunities to make investments in their respective growth areas. The spinoff is also expected to allow each company to adopt the capital structure, investment policy and dividend policy best suited to the financial profile and needs of each business. In addition, the spinoff is expected to improve the alignment of management and employee incentives with performance and growth objectives at each company.
“After a thorough and thoughtful review, the board unanimously approved the spinoff with the intent to create greater long-term value for shareholders,” said R. Kerry Clark, chairman and chief executive officer of Cardinal Health. “We are eager to begin new chapters for Cardinal Health and CareFusion, as the focus on improving the cost-effectiveness and quality of health care, particularly in the U.S., plays directly into the unique strengths of both companies.”
As previously disclosed, the Internal Revenue Service has issued a private letter ruling that the contribution by Cardinal Health of the assets of the clinical and medical products business to CareFusion and the distribution of CareFusion common stock to Cardinal Health shareholders will qualify as a transaction that is tax-free for US federal income tax purposes. It is important that shareholders consult their tax advisers regarding the particular consequences of the spinoff to them including the applicability and effect of any US federal, state, local and foreign tax laws.
