The transaction includes BPS’ manufacturing facilities, along with around 1,700 employees working in Bloomington, Indiana and Halle, Germany, and the unit is expected to generate about $600m in revenues, for the full year 2023
Baxter to sell its BioPharma business. (Credit: James Yarema on Unsplash)
US-based healthcare company Baxter International has signed a definitive agreement to divest its BioPharma Solutions (BPS) business to Advent International and Warburg Pincus.
Under the terms of the agreement, Baxter will receive $4.25bn in cash, along with net after-tax proceeds, currently estimated to be around $3.4bn.
The transaction is expected to close in the second half of 2023, subject to receipt of customary regulatory approvals and satisfaction of other customary closing conditions.
Baxter intends to use the after-tax proceeds to reduce its debt, as part of its capital allocation priorities.
Baxter chairman, president, and chief executive officer José E Almeida said: “BPS has long been recognized worldwide as a trusted and preferred partner of contract manufacturing services for the pharmaceutical and biotech industries.
“Advent International and Warburg Pincus have extensive experience helping innovative healthcare companies advance their mission and strategic priorities.
“I am confident that under their stewardship, BPS will continue to build on its leadership position, foster world-class talent, invest in new capabilities and capacity, and provide leading-edge, high-quality solutions for its clients.”
BPS is engaged in providing sterile contract manufacturing solutions, parenteral delivery systems and customised support services to the pharma and biotech industries.
The proposed transaction includes its manufacturing facilities and around 1,700 employees working in Bloomington, Indiana and Halle, Germany.
BPS is expected to generate about $600m in revenues, for the full year 2023.
Upon closing, it will operate as a standalone company, in partnership with Advent and Warburg Pincus, to provide end-to-end CDMO services for clients.
Baxter said that BPS should be well-positioned to advance its strategy, clinical development pipeline, execute on throughput expansion and drive further product innovation.
Perella Weinberg Partners served as financial advisor and Sullivan & Cromwell as legal advisor to Baxter, on this transaction.
Moelis & Company and Truist Securities served as financial advisors and Cleary Gottlieb Steen & Hamilton and Ropes & Gray as legal advisors to Advent and Warburg Pincus.
Advent managing partner John Maldonado said: “BPS is a premier asset at the forefront of the biopharma industry, and one we’ve been closely following for a number of years.
“We believe this partnership can unlock multiple opportunities for growth and help the business realize its full potential by serving blue-chip customers, including Baxter, with high-value, specialized and end-to-end capabilities as a standalone company.
“We’re thrilled to partner with BPS to alleviate critical pain points for its customers and to help them provide life-changing therapies to patients around the world.”