Medtronic Files to Spin Off Diabetes Business as MiniMed in IPO
December 19, 2025 · by Fintool Agent
Medtronic-0.62% (NYSE: MDT) filed a registration statement today with the SEC for an initial public offering of its Diabetes business, which will operate as a standalone company called MiniMed and trade on the Nasdaq under the ticker symbol "MMED."
The move marks Medtronic's most significant portfolio restructuring in years, separating a $2.8 billion revenue segment that has delivered six consecutive quarters of double-digit organic growth but operates at lower margins than the parent company's other businesses.
The Deal Structure
Medtronic plans to execute the separation in two phases:
- Initial IPO: MiniMed will sell shares to the public, with Medtronic retaining at least an 80.1% ownership stake initially
- Subsequent Split-Off: Medtronic shareholders will have the opportunity to exchange their MDT shares for MiniMed stock at a discount
This structure allows Medtronic to potentially complete the full separation in a tax-efficient manner. By maintaining the 80.1% threshold initially, the company preserves optionality around the timeline and mechanism for the final distribution.
The IPO is being led by Morgan Stanley and J.P. Morgan as joint lead book-running managers, with BofA Securities, Citigroup, and Piper Sandler as additional book-runners.
Why Medtronic Is Spinning Off a Growth Business
At first glance, separating a segment with six consecutive quarters of double-digit organic growth seems counterintuitive. But the strategic rationale is clear: margin accretion for the parent company.
Medtronic expects the separation to be accretive to its:
- Gross margin
- Operating margin
- Earnings per share
The Diabetes segment, while growing rapidly, operates at lower margins than Medtronic's other businesses—Cardiovascular, Neuroscience, and Medical Surgical. Removing it from the consolidated financials will immediately improve the parent company's margin profile.
MiniMed: A Standalone Growth Story
For MiniMed, independence offers its own advantages. The company will be able to:
- Pursue focused R&D without competing for capital against Medtronic's larger divisions
- Attract talent with equity compensation tied directly to diabetes technology performance
- Move faster in a rapidly evolving competitive landscape
The MiniMed 780G insulin pump system has been the primary growth driver, gaining significant market share since its launch. The system features advanced automated insulin delivery technology that adjusts dosing every five minutes based on sensor readings—a capability that has resonated strongly with patients and physicians.
Financial Profile
MiniMed (Diabetes Segment)
| Metric | Q2 FY2026 | FY2025 |
|---|---|---|
| Revenue | $757M | $2.755B |
| Organic Growth | +7.1% | +11.5% |
| Key Product | MiniMed 780G System | MiniMed 780G System |
Source: Medtronic press releases
The Q2 FY2026 growth of 7.1% represents a deceleration from the prior year's double-digit pace, but management attributed this partly to timing factors and maintained confidence in the underlying demand trajectory.
Medtronic Parent Company
| Metric | FY2023 | FY2024 | FY2025 |
|---|---|---|---|
| Revenue | $31.2B | $32.4B | $33.5B |
| Net Income | $3.8B | $3.7B | $4.7B |
| Gross Margin | 65.1% | 65.8% | 65.4% |
Values retrieved from S&P Global
Post-separation, Medtronic will retain a diversified portfolio across:
- Cardiovascular (~$13B revenue): Cardiac rhythm, structural heart, coronary, aortic
- Neuroscience (~$10B revenue): Cranial & spinal technologies, specialty therapies, neuromodulation
- Medical Surgical (~$8B revenue): Surgical innovations, respiratory interventions
Competitive Landscape
MiniMed will enter the public markets facing formidable competition in the diabetes technology space from Abbott Laboratories-0.39% (NYSE: ABT) and Dexcom-1.03% (NASDAQ: DXCM).
Abbott's FreeStyle Libre has become the dominant continuous glucose monitoring (CGM) system globally, with the company reporting over $6 billion in annual diabetes care revenue. Abbott has taken significant market share with its consumer-friendly, lower-cost approach to CGM.
DexCom remains the CGM market leader in the United States, particularly among insulin-intensive patients. The company has partnerships with multiple insulin pump manufacturers and has been expanding into the Type 2 diabetes market.
MiniMed's differentiation lies in its integrated insulin pump + CGM ecosystem—the ability to offer a closed-loop system where the pump and sensor communicate automatically. However, interoperability trends in the industry have eroded some of this advantage, as patients increasingly mix and match devices from different manufacturers.
What to Watch
Near-Term Catalysts:
- IPO Pricing: The registration statement does not yet include a price range or share count. Amended filings in the coming weeks will reveal the expected valuation
- Management Team: MiniMed's leadership structure and compensation arrangements will be disclosed in the prospectus
- Retained Stake Strategy: Timing and mechanism for Medtronic's eventual full exit
Key Risks:
- Competitive Pressure: Abbott and DexCom continue to innovate aggressively
- Reimbursement Headwinds: Medicare and private payer dynamics remain challenging
- Execution Risk: Standing up a separate public company infrastructure requires significant investment
Timeline: No specific date has been announced for the IPO. The registration statement is currently under SEC review, with the offering expected to occur after the regulatory process is complete.