Baxter International, a medical technology and healthcare company, has agreed to sell its CDMO business, Baxter BioPharma Solutions (BPS), a CDMO of sterile injectables, for $4.25 billion to two private-equity firms: Advent International and Warburg Pincus.  

The move is part of a larger plan by Baxter, which announced a series of actions in January (January 2023) to improve the company’s financial performance, which included evaluating strategic alternatives for its CDMO business. 

BPS provides contract services for formulation development, sterile manufacturing, and lyophilization and parenteral delivery systems. The proposed transaction includes the CMDO’s manufacturing facilities and approximately 1,700 employees in Bloomington, Indiana, and Halle, Germany. BPS is expected to generate revenues of approximately $600 million on a reported basis for the full-year 2023. 

Under the agreement, Baxter will receive $4.25 billion in cash, subject to certain closing adjustments. The transaction is expected to close in the second half of 2023, subject to customary regulatory approvals and satisfaction of other customary closing conditions. Baxter says it intends to use the after-tax proceeds to reduce its debt, consistent with the company’s stated capital allocation priorities. 

Source: Baxter