(Reuters) – Private equity firm Carlyle Group LP is nearing an agreement to acquire Johnson & Johnson’s ortho clinical diagnostics unit, four people familiar with the matter said on Monday, in a deal expected to be worth around $4 billion.
Carlyle is in exclusive talks with Johnson & Johnson after prevailing over a rival bid from Blackstone Group LP (BX.N: Quote, Profile, Research, Stock Buzz) in partnership with healthcare and industrial conglomerate Danaher Corp (DHR.N: Quote, Profile, Research, Stock Buzz), the people said, cautioning that negotiations were ongoing and the outcome could change.
A deal is expected to be reached within the next two weeks, one of the sources said.
The exact price of Carlyle’s offer could not be learned. The sources asked not to be identified because details of the sale process are confidential.
Carlyle, Johnson & Johnson and Blackstone declined to comment. A Danaher representative did not immediately respond to a request for comment.
J&J’s ortho clinical diagnostics unit makes blood-screening equipment and laboratory blood tests. It also makes tests that can identify a patient’s blood type and screen for viruses such as HIV and hepatitis C.
The unit is a small player in a market led by larger rivals such as Roche Holding AG (ROG.VX: Quote, Profile, Research, Stock Buzz), Siemens AG (SIEGn.DE: Quote, Profile, Research, Stock Buzz), Abbott Laboratories (ABT.N: Quote, Profile, Research, Stock Buzz) and Danaher.
Johnson & Johnson said at the beginning of the year it would explore strategic alternatives for the unit and said the process could take from 12 to 24 months. It asked JPMorgan Chase & Co (JPM.N: Quote, Profile, Research, Stock Buzz) to run the sale of the unit, Reuters previously reported.
Johnson & Johnson’s decision to divest the division comes as drugmakers are shedding businesses and cutting costs in response to overseas price controls and pressure on payments from insurers and the government.
Pfizer Inc (PFE.N: Quote, Profile, Research, Stock Buzz), for instance, recently spun off its animal health products business, and Abbott split off its branded drugs unit early this year.