Medtronic to spin off diabetes unit in 18 months

IRELAND – Medtronic, a global leader in healthcare technology, has revealed its plan to separate its Diabetes business into a new independent company.

The move, announced from its headquarters in Ireland, aims to create a more focused Medtronic – one with a simplified portfolio centered on high-margin, fast-growing medical technology sectors.

At the same time, the separation will establish a dedicated company entirely focused on advancing diabetes care through innovation and consumer-centric solutions.

The new standalone company, temporarily referred to as “New Diabetes Company,” will be the only firm to offer a full ecosystem for intensive insulin management.

Its focus will be to improve the lives of people living with diabetes through connected devices and advanced technologies.

Medtronic plans to complete the separation within 18 months via a capital markets transaction, favoring an initial public offering (IPO) followed by a split-off.

The transaction is expected to unlock value for shareholders, improve Medtronic’s earnings, and align each company’s shareholder base with its financial goals.

Post-separation, Medtronic will concentrate on its most profitable growth drivers and key innovation areas such as pulsed field ablation, renal denervation, and soft tissue robotics.

With a leaner structure, the company expects stronger earnings growth and more efficient investment in new technologies.

Meanwhile, the New Diabetes Company will be led by Que Dallara, currently Medtronic’s EVP and President of the Diabetes division.

With over 8,000 employees and a global commercial footprint, the new company will have the scale, expertise, and flexibility to focus on automated insulin delivery systems and smart insulin pens, with investments in innovation and manufacturing automation.

Financially, the Diabetes unit accounted for 8% of Medtronic’s revenue and 4% of its segment operating profit in fiscal year 2025.

Once separated, Medtronic expects the deal to immediately enhance its adjusted gross and operating margins and increase earnings per share.

Additionally, the company anticipates that the transaction will reduce the number of shares outstanding without affecting its dividend policy.

The separation is designed to be tax-free for U.S. shareholders, pending regulatory and board approvals, market conditions, and employee consultations.

Medtronic has enlisted Goldman Sachs and BofA Securities as financial advisors, with support from leading legal and tax firms to oversee the complex transition.