NEW YORK--Animal-medicine maker Zoetis Inc. (ZTS) priced its initial public offering above expectations, a strong showing for the largest deal from a U.S. company since Facebook Inc. (FB) debuted last May.

Zoetis, which is being carved into a standalone company by drug maker Pfizer Inc. (PFE), priced 86.1 million Class A shares at $26 apiece, according to an underwriter familiar with the deal's terms.

The $26 price was more than the $22-to-$25 range initially outlined in documents filed with the Securities and Exchange Commission. The IPO is valued at around $2.2 billion. Zoetis will command a market value of around $13 billion based on the offer price.

Zoetis, of Madison, N.J., is the largest animal-medicine company in the world by revenue. It makes vaccines and drugs for livestock such as cattle and swine, as well as for pets. The company sells its products directly to livestock producers and veterinarians in 70 countries. Revenue from livestock represents the bulk of its sales, although the filing notes pet ownership and spending per pet are increasing around the globe. Emerging markets such as Brazil, China and India represented 27% of Zoetis's revenue in 2011.

The company competes primarily with the animal-health segments of other major drug companies including Merck & Co. (MRK), Sanofi SA (SNY) and Eli Lilly & Co. (LLY).

"Zoetis's IPO will be the first opportunity for a "pure play" in one of the major animal-health manufacturers," said Morningstar Inc. analyst David Krempa. The animal-health industry "has historically been buried within big pharma firms and largely ignored," he said.

Pfizer, the world's largest drug maker by sales, has been shedding businesses outside its core medicine franchise to focus on developing prescription medicines to replace aging products like cholesterol drug Lipitor, which now faces generic competion. Last year, Pfizer sold its infant-nutrition business to Nestle SA (NESN.VX).

Zoetis reported revenue of $3.2 billion for the first nine months of last year, or about 7% of Pfizer's $43.9 billion in overall revenue during that period. Zoetis's revenue increased 1.7% over that time, while net income rose 87% to $446 million.

The company will operate with a dual-class share structure. Current Pfizer shareholders must go into the open market to buy some of the 81.6 million Zoetis Class A shares that will be sold in the IPO. Pfizer will hold all 414 million Class B shares, giving it roughly 83% control of Zoetis.

Other large carve-outs from well-known companies have been successful for participating investors in recent years. Bristol-Myers Squibb Co. (BMY) sold its baby-formula maker Mead Johnson Nutrition Co. (MJN) in 2009. Mead Johnson's shares have more than tripled since.

The deal is the largest IPO from a U.S. company since Facebook's $16 billion deal on May 18, 2012. It is also the largest carve-out to list on a U.S. exchange since U.K. hedge-fund manager Man Group PLC (EMG.LN) broke away from MF Global Ltd., which was its brokerage arm, in a $2.9 billion deal in 2007, according to Dealogic.

J.P. Morgan Chase & Co. (JPM), Bank of America Corp. (BAC) and Morgan Stanley (MS) are serving as Zoetis's lead underwriters.

By Write to Chris Dieterich at christopher.dieterich@dowjones.com

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