Shares of Johnson & Johnson (NYSE:JNJ) are rising in pre-market trading after the healthcare giant announced that it its splitting itself into two separate publicly traded companies.
The new companies will be focused on consumer products, such as Band-Aid bandages and baby powder, and another focused exclusively on prescription drugs and medical devices.
Shares of Johnson & Johnson jumped 4% in pre-market trading after news broke of the split.
Johnson & Johnson, which, until now, ran a combined pharmaceutical and consumer packaged goods company, says the split will help to unlock value for shareholders.
Johnson & Johnson shares have underperformed the broader market in 2021 having risen only 4% year-to-date to $163.06. That compares to a 25% gain for the S&P 500 index.
News of Johnson & Johnson’s split comes days after General Electric (NYSE:GE) announced that it is splitting into three separate publicly traded entities.