v3.26.1
Related-Party Transactions
 6 Months Ended
Jun. 30, 2026
Related Party Transactions [Abstract]  
Related-Party Transactions
3. RELATED-PARTY TRANSACTIONS
Pursuant to the Spin-Off, the Former Parent ceased to be a related party to the Company and accordingly, no related party transactions or balances have been reported subsequent to April 1, 2026. The Company entered into a number of agreements with the Former Parent to govern the Spin-Off and provide a framework for the relationship between the parties going forward, including a Transition Services Agreement, a Tax Matters Agreement and an Employee Matters Agreement.
In connection with the Spin-Off, the Company paid a dividend of $1,894 million to the Former Parent.
The following discussion summarizes activity between the Company and the Former Parent that occurred prior to the completion of the Spin-Off.
Related Party Sales and Purchases
Prior to the Spin-Off, in the ordinary course of business, the Company entered into transactions with the Former Parent and certain of its subsidiaries for the sale or purchase of goods. Subsequent to the Spin-Off, transactions with the Former Parent and its affiliates represent third-party transactions.
Prior to the Spin-Off, net sales of products from Versigent to affiliates of the Former Parent totaled $2 million for the three months ended March 31, 2026. Net sales of products from Versigent to affiliates of the Former Parent were de minimis and $1 million for the three and six months ended June 30, 2025, respectively.
Prior to the Spin-Off, total purchases from affiliates of the Former Parent totaled $192 million for the three months ended March 31, 2026. Total purchases from affiliates of the Former Parent totaled $201 million and $387 million for the three and six months ended June 30, 2025, respectively.
As of December 31, 2025, $49 million is included within Accounts receivable, net related to amounts due from affiliates of the Former Parent and $172 million is included within Accounts payable related to amounts due to affiliates of the Former Parent. These amounts were previously separately presented as related party balances within the consolidated financial statements for periods prior to the Spin-Off.
Allocations of Costs Prior to the Spin-Off
Prior to the Spin-Off, the Company had certain services and functions provided to it by the Former Parent. These services and functions included, but were not limited to, senior management, legal, human resources, finance and accounting, treasury, information technology services and support, cash management, payroll processing, pension and benefit administration and other shared services. These costs were allocated using methodologies that management believes were reasonable for the item being allocated. Allocation methodologies included direct usage when identifiable, as well as the Company’s relative share of revenues, headcount or functional spend as a percentage of the total.

The total costs for services and functions allocated to the Company from the Former Parent for periods prior to the Spin-Off were as follows:
Three Months Ended June 30,Six Months Ended June 30,
20262025
2026 (1)
2025
(in millions)
Cost of sales$— $37 $13 $56 
Selling, general and administrative— 78 80 156
Restructuring—1—1
Total allocated costs from Former Parent$— $116 93213
(1)All amounts incurred prior to the April 1, 2026 Spin-Off.
Former Parent’s Net Investment
Former Parent’s net investment in the consolidated financial statements represents the Former Parent’s historical investment in the Company, the net effect of transactions with, and allocations from, the Former Parent, as well as Versigent’s accumulated earnings and other comprehensive income (loss). Net transfers (to) from the Former Parent are included within Former Parent’s net investment in the consolidated financial statements. The components of net transfers (to) from Former Parent were as follows:
Six Months Ended June 30,
20262025
(in millions)
Cash pooling and general financing activities, net$(133)$(47)
Corporate cost allocations93 213 
Income taxes (1)(7)(32)
Net transfers (to) from Former Parent per consolidated statements of cash flows(47)134 
Transfer of net assets with Former Parent(17)— 
Related party receivables exchanged with Former Parent28 — 
Deferred and non-cash taxes settled with Former Parent through Former Parent's net investment (1)53 — 
Net transfers from Former Parent per consolidated statements of shareholders' equity (2)$17 $134 
(1)Represents non-cash income tax impacts incurred in the respective period as a result of the application of the separate return basis with respect to the income tax provision and related balance sheet accounts within the consolidated financial statements, as further described in Note 13. Income Taxes, as well as taxes paid by the Former Parent.
(2)Net transfers (to) from Former Parent per consolidated statements of shareholders’ equity was $(36) million and $95 million for the three months ended June 30, 2026 and 2025, respectively.