Tyco International Ltd. has announced intentions to split into three separate public companies, ending years of speculation about the company's future as a single entity. The company said it will split its electronics and health care—including its sizable private label diaper operation—businesses off as separate firms, keeping the remainder of its operations, including security and fire-protection services, as a third firm. The cost of the split, expected to occur early next year, is estimated at $1 billion.
The decision to split the company comes four years after it first considered such a breakup. The firm has also been mired in accounting scandals with former CEO Dennis Kozlowski and former Chief Financial Officer Mark Swartz, both of whom were sentenced to prison last year.
The three companies will each have their own boards of directors. Rich Meelia, currently president of the health care segment of the company, will become CEO of the spun-off Tyco Healthcare. Tyco Electronics will be led by Juergen Gromer. Tyco International will continue to be headed by CEO Edward Breen.