Cardinal to sell pharma unit.(The Week in Healthcare)(Blackstone Group L.P. acquires Cardinal Health Inc.'s unit)

Byline: Cinda Becker

In yet another grab from the private equity market for a piece of healthcare, Cardinal Health said it will sell its pharmaceutical technologies and services business to the Blackstone Group for approximately $3.3 billion in cash.

The agreement provides for Blackstone to acquire the Cardinal businesses that develop, manufacture and package medication and other products for pharmaceutical and biotech firms, employing approximately 10,000 people at more than 30 facilities and generating approximately $1.8 billion in revenue annually.

Cardinal, based in Dublin, Ohio, had announced in November 2006 that it planned to divest the segment to focus resources on its four remaining businesses: pharmaceutical distribution, medical device distribution and two separate divisions that manufacture clinical and medical products.

Cardinal said it plans to use the net proceeds from the sale to repurchase shares. The sale is expected to generate approximately $3.1 billion in after-tax proceeds, Cardinal said in a news release. "We think it is good use of our capital,'' said Jim Mazzola, a Cardinal spokesman.