Exclusive: Warburg and Advent in the lead to acquire Baxter's biopharma unit

NEW YORK, May 7 (Reuters) - A private equity consortium comprising Warburg Pincus and Advent International is in advanced talks to acquire medical device maker Baxter International Inc's (BAX.N) biopharma solutions business in a deal that could reach or exceed $4 billion, people familiar with the matter said on Sunday.

Warburg Pincus and Advent have submitted the most attractive offer to Baxter in an auction that drew interest from other private equity firms as well as major players in the biomedical sector such as Thermo Fisher Scientific Inc (TMO.N), the sources said.

The buyout consortium has turned to other private equity firms to help fund the deal as direct lenders, one of the sources added.

There is no certainty that Warburg Pincus and Advent will successfully complete negotiations to acquire the unit and Baxter may still opt to sell to another bidder or keep the business, according to the sources. They requested anonymity because details of the sale process are confidential.

Baxter, Warburg and Advent did not immediately respond to requests for comment. Thermo Fisher declined to comment.

Baxter's biopharma solutions unit supports drugmakers in the formulation, development and commercialization of drugs typically given by infusion or injection, such as biologics and vaccines.

Baxter, which has a market value of $23 billion, said in January it would explore a sale of the unit to "enhance focus and improve capital structure," a reference to its push to shed non-core businesses and pay down some of its $16.4 billion debt pile.

Baxter also plans to spin off its renal care and acute therapies units. The company said dialysis operations, which are a part of Baxter's renal care unit, had become a drag on its margin.

Medtronic Plc (MDT.N), another medical device maker, unveiled a plan in October to spin off its patient monitoring and respiratory interventions businesses, which have since attracted interest from potential buyers.

Reporting by David Carnevali and Anirban Sen in New York; editing by Diane Craft

Our Standards: The Thomson Reuters Trust Principles.

Thomson Reuters

Anirban Sen is the Editor in Charge for U.S. M&A at Reuters in New York, where he leads the coverage of the biggest deals. After starting with Reuters in Bangalore in 2009, Anirban left in 2013 to work as a technology deals reporter in several leading business news outlets in India, including The Economic Times and Mint. Anirban rejoined Reuters in 2019 as Editor in Charge, Finance to lead a team of reporters, covering everything from investment banking to venture capital. Anirban holds a history degree from Jadavpur University and a post-graduate diploma in journalism from the Indian Institute of Journalism & New Media. Contact:+1 (646) 705 9409