Family-controlled Solvay Group announced today it is to sell its pharmaceutical business to American healthcare company Abbott in a deal worth around €5.2 billion.
The announcement brings to an end a week of speculation over who the winning bidder would be for the billion-dollar arm of the family company. Abbott will pay €4.5 billion in cash to be made between 2011 and 2013, with additional potential payments of up to €300 million. Abbott will also take on liabilities thought to be worth €400 million.
A statement released by Solvay today said that the Group was refocusing its activities and focusing on "long-term value creation". "We are building a new refocused Group with the financial means to further accelerate sustainable growth on today's strong foundations," said Christian Jourquin, Solvay's non-family CEO.
The Solvay Group recorded 2008 revenues of €9.5 billion, €2.7 billion of which created by the pharmaceutical sector of the business. It will retain control of the profitable chemical and plastics businesses, in which it plans to reinvest some of the sale profits from the pharmaceutical arm.
Solvay is in its sixth-generation of family ownership and has over 2,500 family shareholders, who between them own 30% of the multinational business. Founded in 1863 by Ernest Solvay, the company still works in the chemical industry in which it first began. Fifth-generation Denis and Jean-Marie (pictured) Solvay both work in senior management of the group, Denis as vice-chairman and Jean-Marie as a company director.
Click here to read our feature on the new communications strategies of the Solvay family: Connecting the world of Solvay
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