Bayer Wednesday announced it is selling off its diabetes care business to Panasonic Healthcare Holdings Co., in a deal valued at just over $1.1 billion (1 billion euros).
The move is part of a larger effort by the German drugmaker to refocus on prescription and over-the-counter drugs, as well as its crop science business.
The transaction, which had been in the works since February, is expected to close in the first quarter of 2016, Bayer said. The diabetes unit manufactures devices for monitoring blood glucose levels.
Panasonic Healthcare, based in Japan, is a joint venture between Panasonic Corp. and U.S. private-equity firm KKR & Co. Panasonic Corp. sold 80% of Panasonic to KKR last year.
“We are confident that the sale of our diabetes-care business to our long-standing partner Panasonic Healthcare, with the strong backing of KKR, will support the long-term sustainability of this portfolio,” said Werner Baumann, a Bayer board member and CEO of Bayer HealthCare, in a news release.
Bayer has been active in M&A of late. The company in October acquired Merck & Co.'s over-the-counter business for $14.2 billion, and the company announced plans in September 2014 to free itself of its high-tech plastics business through an initial public offering, which it has indicated it plans to offer by the middle of next year.
The Bayer diabetes unit that Panasonic Healthcare is buying recorded sales of 909 million euros last year. Bayer had total revenue of 42.2 billion euros in 2014.