Danaher Corporation (NYSE: DHR – $98.54) announced that the Board of Directors has declared a pro rata dividend of all of the common stock of Fortive to Danaher stockholders of record as of the close of business on June 15, 2016. The dividend is payable on July 2, 2016 in connection with the previously announced separation of Danaher’s existing Test & Measurement segment, Industrial Technologies segment and Retail/Commercial Petroleum platform through the planned spin-off. The new company, Fortive Corp., will be composed of two segments: Professional Instrumentation and Industrial Technologies, and will include market leading brands such as Fluke, Qualitrol, Tektronix, Gilbarco Veeder-Root, Kollmorgen and Matco Tools. As a result of the dividend, Danaher stockholders will receive one share of Fortive common stock for every two shares of Danaher common stock they hold as of June 15. No action is required by Danaher stockholders to receive the distributed shares of Fortive common stock. As of this date, there was no discussion on the dividend distribution(s) for the two new stocks and how the $12 billion in debt and other assets and liabilities will be apportioned.
Following the transition of the “new” Danaher, which will maintain the Life Sciences and Diagnostic Segment (Beckman-Coulter, Leica, the recent Pall acquisition, etc.) and the Dental Segment, I will provide some direction as to which of the two new companies will remain in the conservative portfolio, if any. The separation should be completed tax-free in the third quarter of 2016. In the meantime, the shares have been in a holding pattern since mid-April, but have climbed to a recent all-time-high of over $100 last week, and can continue to be held for now.