July 22 (Bloomberg) -- Baxter International Inc., the world’s second-largest maker of dialysis products, won conditional approval from European Union to buy Swedish competitor Gambro AB to expand its kidney-equipment business.
To allay competition issues, Baxter agreed to divest its continuous renal replacement therapy, or CRRT, business, which serves patients suffering from acute kidney failure, the European Commission said today in a statement.
Baxter announced in December that it had reached agreement to buy Gambro for 18.3 billion kronor ($2.8 billion). The CRRT business has about $50 million in sales, Robert Hombach, Baxter’s chief financial officer, said on a July 18 conference call.
“It’s a relatively small business, about $50 million in annual revenues with, frankly, below-corporate-average margins, and so that is something that we will look to divest,” Hombach said. The loss of the business won’t affect the Deerfield, Illinois-based company’s full-year financial forecast, he said on the call.
Gambro has a CRRT business with about $300 million a year in sales, Hombach said on a June conference call. Getting rid of Baxter’s existing business will help keep competition in the market, the commission said. Baxter announced in December that it had reached agreement
Baxter gained less than 1 percent to $74.43 at 4 p.m. New York time. The company’s shares have increased 32 percent in the last 12 months.