(Bloomberg) -- Belgian biotech company Galapagos NV plans to spin off part of its operations, creating a new listed firm with approximately €2.45 billion ($2.5 billion) in cash.
The newly formed company, preliminarily called SpinCo, will apply to have its shares listed on Euronext, according to a statement on Wednesday. The separation is expected to occur by mid-2025.
Galapagos shares rose as much as 11% in early Amsterdam trading, the most since August.
At the time of the split, Gilead Sciences Inc. will hold approximately 25% of the outstanding shares in both Galapagos and SpinCo. Gilead is Galapagos’ majority shareholder, with approximately 25.4% of the firm’s shares following a $5.1 billion investment in 2019.
Galapagos also plans to cut approximately 300 jobs in Europe as it reorganizes the business to focus on cell therapy in oncology. The company expects to close its site in France.
Meanwhile, SpinCo will focus on building a pipeline of innovative medicines, with Galapagos gaining full global development and commercialization rights to the pipeline.
The spinoff is subject to concluding consultations with works councils and Galapagos shareholders’ approval.
(Updates with Galapagos shares in the third paragraph)
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