Overview of the Deal
- Acquirer: Carlyle Group
- Target: Baxter International’s Kidney Care Segment (to be named Vantive)
- Total Transaction Size: $3.8 billion
- Announcement Date: August 13, 2024
- Expected Close Date: Early 2025
- Target Advisors: Perella Weinberg Partners and JPMorgan (Financial); Sullivan & Cromwell LLP (Legal)
- Acquirer Advisors: Barclays and Goldman Sachs (Financial); Kirkland & Ellis LLP (Legal)
On August 13, 2024, Baxter International Inc. and funds managed by Carlyle announced a definitive agreement for Carlyle to acquire Baxter’s Kidney Care segment, to be named Vantive, for $3.8 billion. Under the terms of the agreement, Baxter will receive approximately $3.5 billion in cash, with net after-tax proceeds estimated at around $3 billion. This transaction is part of Baxter’s strategic realignment to enhance performance and create value for stakeholders. The proceeds are intended to reduce Baxter’s debt, aligning with its capital allocation priorities.
Carlyle’s investment in Vantive is made in partnership with Atmas Health, a collaboration among industry executives focusing on building a market-leading healthcare business. Kieran Gallahue will serve as Chairman of Vantive, working with CEO Chris Toth and the Vantive management team.
Company Details (Acquirer – Carlyle Group)
Carlyle Group is a global investment firm specializing in private equity, real assets, and private credit. With $435 billion in assets under management as of June 30, 2024, Carlyle invests across various sectors, including healthcare, leveraging deep industry expertise to drive growth and value creation.
- Founded: 1987
- Headquarters: Washington, D.C., USA
- CEO: Harvey M. Schwartz
- Assets Under Management: $435 billion (as of June 30, 2024)
- Recent Transactions:
- Acquisition of Medline Industries in partnership with other firms (June 2021)
- Investment in Saama Technologies (March 2022)
Company Details (Target – Vantive)
Vantive, formerly Baxter’s Kidney Care segment, is a leading provider of dialysis products and services, serving patients with kidney disease worldwide. In 2023, the business generated approximately $4.5 billion in revenue and employed over 23,000 individuals.
- Founded: 2024 (spun off from Baxter International)
- Headquarters: To be determined
- CEO: Chris Toth
- Annual Revenue: Approximately $4.5 billion (2023)
- Number of Employees: Over 23,000
Projections and Assumptions
Short-Term Consequences
The divestiture allows Baxter to streamline operations and focus on core areas, using the proceeds to reduce its debt, which stood at $13.8 billion at the end of 2023. For Carlyle, acquiring Vantive aligns with its strategy to invest in growing healthcare businesses with strong market positions.
Long-Term Upsides
As a standalone entity under Carlyle’s ownership, Vantive is positioned to pursue strategic growth initiatives, enhance operational efficiencies, and expand its global footprint in the kidney care market. Carlyle’s resources and expertise are expected to support Vantive in achieving these objectives.
Risks and Uncertainties
The transaction is subject to customary closing conditions, including regulatory approvals. Potential risks include integration challenges, market competition, and the need to maintain continuity in leadership and customer relationships during the transition.
Sources
- Baxter Announces Definitive Agreement to Divest Its Vantive Kidney Care Segment to Carlyle For $3.8 Billion
- Baxter Announces Definitive Agreement to Divest Its Vantive Kidney Care Segment to Carlyle for $3.8 Billion
- Carlyle to Buy Baxter’s Kidney-Care Spinoff Vantive for $3.8 Billion
- Baxter to Sell Its Kidney-Care Business in a $3.8 Billion Deal to Carlyle Group
- Baxter Stock Falls After it Unloads Kidney Care Division in $3.8B Deal
