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Bristol-Myers agrees to sell ConvaTec unit

May 03, 2008|From the Associated Press

NEW YORK — Drug developer Bristol-Myers Squibb Co. said Friday that it would sell its wound therapy and surgical care unit for $4.1 billion to two private equity firms.

The company will sell the ConvaTec unit to Nordic Capital and Avista Capital Partners. Proceeds from the sale will help fund Bristol-Myers' strategy of shifting its focus to biopharmaceuticals. That strategy has already resulted in the $525-million sale of the New York-based company's medical imaging unit as well as plans to sell 10% to 20% of its Mead Johnson Nutritional unit.

Bristol-Myers and many of its peers have been on a mission to reinvent themselves as blockbuster drugs lose patent protection and generic drug developers cut into their revenue drivers. Many companies have been laying off workers.

In December, Bristol-Myers said it would lay off about 4,300 employees, or 10% of its workforce, and close more than half of its manufacturing plants as part of its goal to save $1.5 billion annually by 2010.

The $4.1-million infusion is significant when compared with the company's quarterly revenue. During the first quarter, Bristol-Myers' revenue rose 20% to $5.18 billion.

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