(Reuters) - Shares of Pfizer Inc's
Shares opened at $31.50 after the Madison, New Jersey-based company's stock was priced at $26, above an expected range of $22 to $25 a share. They were trading down 1 cent at $31.49 in afternoon activity.
Zoetis raised $2.2 billion in the largest initial public offering by a U.S. company since Facebook Inc's
The offering comes as Zoetis' parent firm, Pfizer, the world's biggest drugmaker, divests its nonpharmaceuticals units to focus on its core prescription drugs business.
Last April, Pfizer sold its infant nutrition business to Nestle SA
Zoetis, which has annual sales of about $4.2 billion and 9,500 employees worldwide, is the largest player in the $22 billion animal health industry. It sells vaccines and diagnostics, among other medicines. About two-thirds of its sales are from products and services for livestock.
Pfizer will control roughly 80 percent of Zoetis after the IPO, which accounts for 413.9 million Class B shares. The drugmaker is expected to divest its stake within 18 months, and return much of the proceeds to Pfizer shareholders in the form of stock repurchases.
Zoetis' CEO, Jean Ramon Alaix, had been president of Pfizer's animal health unit.
Alaix, citing industry data, on Friday said sales of products for livestock are expected to have compound annual growth of 6 percent for the next five years, while product sales for companion animals should grow 5 percent each year.
"Our industry's growth is steady and predictable and we believe Zoetis can grow in line with or faster than the market," he said in an interview.
Sales of animal health products cannot help but grow because the world population, now about 7 billion, is expected to reach 9 billion in 2050, the CEO said.
"We will be able to provide products that increase productivity related to livestock, and to products for more people adopting pets," Alaix said.
J.P. Morgan Chase & Co
(Editing by Bernadette Baum and Matthew Lewis)
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