Novartis shareholders approve all resolutions proposed by the Board of Directors at the Annual General Meeting

  • Shareholders approve 22nd consecutive dividend increase to CHF 2.85 (+2%) per share for 2018; representing a 3.1% yield and approximately 57% payout of free cash flow
     
  • Overwhelming majority of shareholders approve proposed 100% spin-off of the Alcon eye care division
     
  • Dr. Joerg Reinhardt confirmed by shareholders as Chairman of the Novartis Board of Directors as well as all other members who stood for re-election; Mr. Patrice Bula elected to the Board of Directors
     
  • Shareholders approve all other proposals of the Board of Directors, including in an advisory vote the 2018 Compensation Report as well as the future Board and Executive Committee compensation in separate binding votes

Basel, February 28, 2019 - Novartis shareholders today agreed to the Board of Directors’ recommendations for all proposed resolutions at the Group’s Annual General Meeting (AGM). A total of 1,991 shareholders were present at the meeting held in Basel, representing approximately 65.6% of the issued shares of Novartis.

Shareholders approved the 22nd consecutive dividend increase per share since the creation of Novartis in 1996, with an increase of 2% to CHF 2.85 for 2018. Payment for the 2018 dividend will be made as of March 6, 2019. The dividend for 2018 is an approximately 57% payout of free cash flow, reinforcing the Company’s ongoing commitment to a strong dividend yield.

Proposed spin-off of the Alcon eye care division
Novartis shareholders approved the proposed 100% spin-off of the Alcon eye care division, as previously endorsed by the Novartis Board of Directors.

In addition to shareholder approval, completion of the  spin-off remains subject to certain conditions precedent, such as no material adverse events, receipt of necessary authorizations . The spin-off is expected to be completed in the second quarter of 2019.

The spin-off will be implemented through the distribution of a dividend-in-kind of new Alcon shares to Novartis shareholders and ADR (American Depositary Receipt) holders. The distribution is expected to be tax neutral on a US and Swiss income tax basis. Shareholders will receive the following:

  • For every 5 Novartis shares: 1 Alcon Share
  • For every 5 Novartis ADRs: 1 Alcon Share

The Novartis shareholder brochure for the Alcon spin-off can be accessed here: https:// www.novartis.com/sites/www.novartis.com/files/2019-novartis-agm-alcon-en.pdf.

The latest update to the Alcon Form 20-F registration statement filed with the US Securities and Exchange Commission (SEC) can be accessed here: www.sec.gov/cgi-bin/­browse-edgar?company=Alcon+inc.

Annual re-election and election of Members of the Board
Shareholders re-elected Dr. Joerg Reinhardt as Chairman of the Board of Directors, and all members of the Board, for one year. Dr. Dimitri Azar decided not to stand for re-election. The Board of Directors sincerely thanks him for his many years of distinguished services on the Board of Directors.

In addition, shareholders re-elected the following members of the Board of Directors to the Compensation Committee for one year: Srikant Datar, Ph.D., Ann Fudge, Enrico Vanni, Ph.D. and William T. Winters. The Committee will be chaired by Mr. Vanni.

Further, shareholders elected Mr. Patrice Bula to the Board of Directors and as a member of the Compensation Committee.

In line with the Board of Director’s recommendation, shareholders also approved the cancelation of 23,250,000 shares repurchased under the seventh share repurchase program in 2018 and to reduce the share capital accordingly by CHF 11,625,000, from CHF 1,275,312,410 to CHF 1,263,687,410.

Shareholders also approved the launch of an eighth share repurchase program up to a maximum of CHF 10 billion worth of shares until 2022.

Votes on Compensation for the members of the Board of Directors and the Executive Committee
In two separate binding votes, shareholders approved the total maximum amount of compensation for the members of the Board of Directors covering the period from the 2019 AGM to the 2020 AGM and the total maximum amount of compensation for the members of the Executive Committee for 2020.

Shareholders also endorsed the 2018 Compensation Report in an advisory vote. It contained enhanced disclosures in many areas providing greater transparency. The report also informed stakeholders of prospective changes to the compensation system. These are based on the constructive feedback received from shareholders, our business strategy, and developing market practice.

For a detailed listing of all resolutions presented at the 2019 Annual General Meeting, please visit: www.novartis.com/sit­es/www.novartis.com/files/2019-novartis-agm-notice.pdf.