Elanco Animal Health is in the process of restructuring, in an effort to streamline its international operations.
In a filing with the U.S. Securities and Exchange Commission (SEC), Elanco stated that its board of directors on December 10 authorized a restructuring program that will shift its focus and resources to priority areas.
The proposed restructuring reflects a change from having a physical location to a distribution model in certain countries, in connection to Elanco’s recent spinoff from that of parent company Eli Lilly & Company and initial public offering (IPO), according to the SEC filing.
The SEC filing further stated that as part of Elanco’s ongoing efforts in connection with its separation from Eli Lilly & Company, the board authorized the write-off of certain assets that will not be utilized in the business on an ongoing basis.
The proposed restructuring is expected to lead to a charge of approximately $37 million in the fourth quarter of fiscal year 2018, consisting of approximately $19 million in severance costs and approximately $18 million in asset write-off expenses. The total cash expenditures associated with the restructuring program are expected to be approximately $20 million, and consist primarily of severance costs.
The animal health company expects to substantially complete the restructuring actions by December 2019.
The SEC filing was signed by Michael-Bryant Hicks, general counsel and corporate secretary of Elanco Animal Health.
Founded in 1954, Elanco Animal Health’s mission is to provide comprehensive products and knowledge services to improve animal health and food-animal production in more than 90 countries around the world. The company, according to a press release, values innovation, both in scientific research and daily operations, and strives to cultivate a collaborative work environment for more than 5,800 employees worldwide.
Elanco Animal Health’s worldwide headquarters and research facilities are located in Greenfield, Indiana.