Baxter's core business unit spun off

Baxter Korea Announces Voluntary Retirement on '2n+2' Condition

Workforce reduction due to division spin-off

Independent corporation, including key items such as peritoneum and hemodialysis

Baxter will spin off its key business unit.

 

The industry expects the division to become independent and sell it to private equity funds.

 

In the aftermath, the Korean branch is reducing its workforce.

 

According to the pharmaceutical industry on the 12th, Baxter Korea recently conducted voluntary retirement (ERP) for its employees.

 

Those who have worked for more than 10 years or were born in 1977 are eligible.

 

The compensation condition is known as '2n+2'.

 

This means that retirement benefits will be paid twice the number of years of service plus two months.

 

The reduction of Baxter Korea's workforce is related to the global headquarters' decision to spin off its business units.

 

Recently, Baxter announced that it will spin off its core business unit.

 

The plan is to spin off 'Renal Care and Acute Therapies Global Business Units (GBUs)' and list it newly.

 

The Xinjiang division accounts for about half of Baxter's total sales.

 

It also includes peritoneal dialysis machines, which have the highest sales, and hemodialysis products, which are major products.

 

The independent corporation also includes a portfolio of new products to be released in the future.

 

The industry expects Baxter to spin off its key department into an independent corporation and then go through the sale process.

 

It is predicted that the amount sold will be used to pay off the debt of the acquisition fund.

 

In 2021, Baxter acquired Hilom, a digital medical device company, for $10.5 billion (about 12 trillion won) in cash.

 

분사되는 신장 사업부(좌)와 기존 박스터 매출(자료: 박스터)

Baxter has a precedent of selling its hemophilia treatment division in 2015.

 

The division, which includes items related to hemophilia treatments such as "Adbate," was established as an independent corporation called "Box Alta" and sold to Shire for about 32 billion dollars (about 38 trillion won) the following year.

 

It was the largest M&A transaction in the pharmaceutical industry at the time.

 

As the Xinjiang division is also making solid sales as a key division of Baxter, it is predicted that a "big deal" will occur.

 

However, the decision to spin off is expected to lead to confusion in the Korean branch.

 

An industry official said, "Baxter has built a solid position by operating the Xinjiang division for more than 60 years.

 

However, he/she seems to have decided to spin off because he/she believes that there is not much room to expand the market, such as losing market share to competitors recently, he/she said.

 

"The company is in a chaotic atmosphere due to issues such as manpower reduction, spin-off, and sale."