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Private investors from Advent International and Warburg Pincus will operate the assets as an independent CDMO.
Baxter, a global medical technology company, announced its agreement to divest its BioPharma Solutions Department (BPS) on May 8, 2023. Advent International, a private equity firm, and Warburg Pincus, a global growth investor, will pay approximately $4.25 billion in cash for the BPS manufacturing facilities and 1700 employees in Bloomington, Ind., and Halle, Germany. The transaction is expected to close in the second half of 2023.
Baxter plans to use the cash from the deal to reduce its current debt. Advent and Warburg plan to operate BPS as an independent full-service contract development and manufacturing organization (CDMO) specializing in sterile contract manufacturing solutions, parenteral delivery systems, and customized support services to the pharma and biotech industries. According to a company press release, BPS is expected to generate approximately $600 million in revenue in 2023.
“Today represents an important step in Baxter’s ongoing transformation journey as we continue to execute against our strategic priorities, enhance our focus, and create additional value for all our stakeholders,” said José E. Almeida, chairman, president, and CEO, Baxter, in the press release. “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 a premier asset at the forefront of the biopharma industry, and one we’ve been closely following for a number of years,” said John Maldonado, a managing partner at Advent. “Leveraging our deep sector expertise and significant strategic resources, 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.”