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(Bloomberg) -- Fresenius SE raised close to €1.1 billion ($1.2 billion) in a sale of shares in Fresenius Medical Care AG as well as exchangeable bonds linked to the dialysis firm, as it looks to cut debt and reallocate capital.
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The German group sold 10.6 million shares in Fresenius Medical Care to raise around €471 million, and about €600 million worth of three-year zero-coupon exchangeable bonds, Fresenius said in a statement on Tuesday.
The Fresenius Medical Care shares in the sale, as well as the shares underlying the bonds, represent about 7% of the company’s shares outstanding, the statement showed. Fresenius intends to retain at least 25% of Fresenius Medical Care plus one share, it said.
“By capitalizing on recent share price gains, and the combined transaction structure, we have realized value while continuing to be involved in their future success,” Fresenius Chief Executive Officer Michael Sen said in the statement.
Shares of Fresenius slid 0.6% on Tuesday, paring this year’s advance to 16%. Fresenius Medical Care stock dropped 7.4% to erase 2025 gains.
The deal adds to the trend of companies offloading stakes in spinoffs, aided by a record-breaking stock rally that has fueled stake sales in the region to a 20-year high.
The transaction was eagerly awaited by investors, although Sen repeatedly said he sees further return potential of the investment. At its latest earnings conference, he pointed to Fresenius Medical Care’s positive outlook, in contrast to its competitor DaVita Inc.
The deconsolidation of the kidney-dialysis arm in 2023 was part of Sen’s push to sharpen the company’s focus. He now aims to drive profits with the remaining two core areas: the hospital business Helios and its drug- and medical device-supplier arm Kabi.
Revamp Promises
The proceeds from the transaction will help Fresenius deliver on its revamp promises, including the goal of further reducing its leverage and achieving higher profits in 2025 despite higher costs in the hospital business.
Fresenius will remain committed to its role as the largest shareholder in Fresenius Medical Care over the long term “to keep our influence in an attractive business,” Sen said Tuesday in a call with journalists.
“There are enough arguments in dialysis,” Sen said. “In late-stage chronic kidney disease, there are no other treatment options and so there is still a lot of room for value appreciation.”