World’s Biggest Drug Maker, Pfizer to sell Capsugel Manufacturing Unit to KKR

World’s biggest drug maker, Pfizer Inc agreed on 4 April 2011 to sell its Capsugel manufacturing unit to KKR & Co. for $2.38 billion. The decision to sell the Capsugel manufacturing unit was reached in an effort to focus on its higher-profit business developing new medicines. Capsugel which is Pfizer’s smallest unit, made more than 180 billion hard capsules for drugs in 2010. The unit is separate from Pfizer’s drug business and will be easy to split off.

The New York company, Pfizer lowered its yearly revenue forecast after backing out Capsugel, a unit that makes wholesale pill casings and had $750 million in sales in 2010. The proceeds from the sales deal to expand a planned $5 billion share repurchase.

The Capsugel buy is KKR’s second-largest deal in the past year. In November 2010 a KKR-led group agreed to buy Del Monte Foods for $5.3 billion including debt.