Abbott Plans to Spin Off $8.5 Billion Nutrition Business by 2027
Key Facts
Abbott announced on October 21, 2026, that it plans to separate its global nutrition business and turn it into an independent publicly traded company, a move it said would allow the two companies to pursue different growth and value-creation strategies. Under the company’s announcement, shares in the new entity will be distributed to Abbott shareholders, who will then own shares in both companies once the transaction is completed. The company is targeting completion of the separation by the end of 2027, subject to regulatory approvals, the effectiveness of a registration statement and final board approval. Abbott says the nutrition business will continue operating within the group throughout the separation process. The announcement puts portfolio restructuring in the spotlight as segment results showed mixed performance, with third-quarter growth and a decline in the first nine months.
Abbott estimated annual sales for the nutrition business at about $8.5 billion, with about 16,000 employees across 14 manufacturing sites. The planned independent company’s portfolio includes the Similac, PediaSure, Pedialyte, Glucerna and Ensure brands. Abbott, meanwhile, expects the parent company to have sales of about $42 billion after the separation, with its remaining operations focused on medical devices, diagnostics and established pharmaceuticals. Under this arrangement, shareholders will have direct exposure to two companies with different businesses, through the share-distribution mechanism announced by the company. Abbott said it intends to carry out the separation in a manner intended to be tax-free for U.S. federal income tax purposes.
Nutrition segment sales were $2.262 billion in the third quarter of 2026, up a reported 5.1% and comparable growth of 4.9% from the same period in 2025. The segment’s growth was below comparable sales growth for Abbott, which rose 7.0%, even as the company’s total sales reached $13.013 billion. Nutrition sales increased by $118 million compared with the second quarter of the year. The picture differs over a longer period: segment sales were $6.423 billion in the first nine months, down a reported 1.3% and a comparable 2.1% from the same period in 2025. These figures show that third-quarter performance improved against the cumulative trend since the start of the year, without erasing the decline over the first nine months.
Abbott cited standalone growth opportunities as its stated rationale. Chairman and Chief Executive Officer Robert Ford said the nutrition business could benefit from growing demand for healthy nutrition. He added that the business “will be better positioned as a standalone company,” allowing it to direct its resources and strategic priorities. The company said the segment launched 10 products in the first half of 2026. They include a high-protein Ensure shake containing 42 grams of protein. These launches offer a glimpse of the product renewal the company cites in its presentation of the nutrition business ahead of the separation.
At the group level, Abbott reported adjusted diluted earnings per share of $1.42 in the third quarter and reaffirmed its 2026 full-year guidance range of $5.50 to $5.55 per share. It said the planned separation will not affect its 2026 guidance or its 2027 guidance, which it plans to provide in January. The nutrition business will remain part of Abbott during the preparation period, the company said, until the conditions for the transaction are completed. Completion depends on regulatory approvals, the effectiveness of a registration statement and final board approval. That makes the end of 2027 a conditional target, not a guaranteed final date.
In trading on October 23, 2026, Abbott shares closed at $103.70, up 1.16% for the session, according to market data. The close followed the announcement of the separation plan on October 21, while available materials do not establish a causal link between the share move and the plan. Approval and regulatory developments, along with the 2027 guidance expected in January, remain among the next announced milestones for investors. The plan also includes preparing a “Form 10” registration statement to become effective before the separation is completed. The company says shareholders will retain their Abbott shares and receive shares in the nutrition company when they are distributed.