Lonza to Sell Capsules & Health Ingredients Business to Lone Star for $3 Billion

March 6 (Reuters) – Lonza Group AG will sell its Capsules & Health Ingredients (CHI) business to Lone Star Funds for an enterprise value of 2.3 billion Swiss francs ($3.0 billion), the Swiss contract development and manufacturing organization (CDMO) announced on Friday. The sale aims to allow Lonza to focus on its core biopharmaceutical offerings.

Strategic Rationale and Background

Lonza first announced its intention to divest the CHI business in December 2024, citing a strategic shift towards higher-growth areas within the pharmaceutical and biotech sectors. The company has been streamlining its portfolio to concentrate on its core competencies in bioconjugation, small molecules and cell & gene therapies. Lonza aims to develop into a pure-play CDMO.

Key Transaction Details

• Transaction Value: 2.3 billion Swiss francs ($3.0 billion) enterprise value.
• Upfront Proceeds: Lonza will receive 1.7 billion Swiss francs upfront.
• Retained Stake: Lonza will retain a 40% stake in the CHI business.
• Total Potential Proceeds: Total undiscounted proceeds are expected to be at or above 3 billion Swiss francs.
• Closing Timeline: The transaction is anticipated to close in the second half of 2026, subject to regulatory approvals and customary closing conditions.
• Exchange Rate: As of March 6, 2026, $1 equals 0.7777 Swiss francs.

About Lonza

Lonza Group AG, headquartered in Basel, Switzerland, is a leading global CDMO serving the pharmaceutical, biotech, and nutrition markets. The company provides a range of services, including drug product development, manufacturing, and testing. Lonza operates over 120 sites worldwide.

About Lone Star Funds

Lone Star Funds is a global private equity firm specializing in real estate, credit, and corporate private equity investments. The firm has a history of acquiring and operating businesses across various industries. Lone Star Funds manages billions of dollars in assets.

Implications for the Industry

This transaction reflects a broader trend in the CDMO industry, where companies are increasingly focusing on specialized services and divesting non-core assets. The sale allows Lonza to strengthen its financial position and invest in its core growth areas, while Lone Star Funds gains a significant foothold in the capsules and health ingredients market.

(Reporting by Bartosz Dabrowski in Gdansk; Editing by Kristen Donovan)