Baxter has signed a definitive agreement under which Carlyle is to acquire its Kidney Care segment, to be named Vantive, for $3.8 billion.
Baxter will receive approximately $3.5 billion in cash with net after-tax proceeds currently estimated to be approximately $3 billion. The company announced its intention to create a standalone kidney care company in January 2023 as part of its broader strategic realignment designed to enhance future performance and create value for all stakeholders.
In March 2024, Baxter announced that it was in discussions to explore a potential sale of the segment. After reviewing the financial impact of the potential separation pathways, management and the Baxter Board determined that selling the business to Carlyle should maximize value for Baxter stockholders and best position Baxter and Vantive for long-term success, with enhanced flexibility to deploy capital toward opportunities that seek to accelerate each company's respective growth objectives. Baxter intends to use after-tax proceeds from the transaction to reduce its debt, consistent with its stated capital allocation priorities.
Carlyle has been a leading private equity investor in the medtech sector over the past decade, with investments in medical technology and diagnostic companies totaling over $40 billion in enterprise value. Moreover, Carlyle's investment in Vantive is made in partnership with Atmas Health, a collaboration among three industry executives founded in September 2022 to focus on acquiring and building a market-leading healthcare business. The partnership, consisting of Kieran Gallahue, Jim Hinrichs, and Jim Prutow, brings a proven track record of creating value in the medical technology industry. Kieran Gallahue will serve as the Chairman of Vantive, working with CEO Chris Toth and the Vantive management team.
Vantive is a leader in global kidney care, offering products and services for peritoneal dialysis, hemodialysis and organ support therapies, including continuous renal replacement therapy (CRRT). The business has more than 23,000 employees globally and had 2023 revenues of $4.5 billion.
The transaction is expected to close in late 2024 or early 2025, subject to receipt of customary regulatory approvals and satisfaction of other closing conditions.
