Panasonic Ponies Up $1.2 Billion for Bayer's Diabetes Biz

Now largely owned by private equity firm KKR, Panasonic Healthcare is making an aggressive expansion.

Qmed Staff

Panasonic Healthcare Holdings has announced that it will buy Bayer's diabetes care business unit for EUR1.02 billion, or roughly $1.15 billion. The acquisition will add a sizable range of blood glucose monitors to Bayer's product portfolio. Last year, the Bayer division had revenue of EUR909 million and sold its products in more than 125 countries.

Panasonic Healthcare has become independent from its parent since the private equity giant Kohlberg Kravis Roberts (KKR) bought 80% of its business for $1.67 billion in 2014. Now, the company is looking to "form strong partnerships with strategically pivotal companies," as Kenji Yamane, the Panasonic Healthcare president, explained in a statement.

Bayer, by contrast, in interested in paring down its business portfolio, after paying $14.2 billion last year for Merck's consumer care business. Bayer recently announced its plans to spin off its plastics business in an IPO tentatively planned for mid-2016. The diabetes business, apart from its ultrasound and cardiology technologies, was one of the only medical device technologies in its product portfolio.

Bayer is increasingly shifting its focus on pharmaceuticals, and is hoping that its new Xarelto blood thinner and the eye treatment drug Eylea will be block products.

The Panasonic-Bayer deal will likely close early next year.