Frankfurt The healthcare group Fresenius wants to separate from the digital subsidiary Curalie. The Handelsblatt learned this from corporate and financial circles. The company, which is part of the Helios clinic division, develops health apps and programs for, among other things, rehabilitation aftercare and for those with chronic illnesses. Curalie is just a start-up in a billion-dollar company; but it was considered a digital prestige project.
The sale of the platform is therefore symbolic: For Michael Sen, 54, CEO, who has been in office for almost a year, the sale of peripheral areas is an important part of his strategy. He wants to concentrate the heavily indebted healthcare group on its core business. Fresenius did not want to comment on the plans when asked.
A few weeks ago, Sen put the Eugin fertility clinic group up for sale, which had only been acquired in 2020. According to information from financial circles, the financial investors KKR and CVC are currently among the most promising bidders. The Eugin Group is valued at more than half a billion euros.
According to industry experts, the sale of Curalie will probably only bring in a few million for Fresenius. At the same time, however, the millions of dollars in investments that the parent company wanted to invest to support the platform would also be eliminated.
According to the 2021 annual report, Fresenius had supported the start-up with start-up financing of six million euros annually in the last four years alone. In 2020, the group’s digital flagship took over its competitor Digitale Gesundheitgruppe (DGG) and temporarily grew to 100 employees.
According to the Federal Gazette, Curalie posted an annual loss of around five million euros in 2021 with sales of just 227,000 euros. According to company circles, Curalie is said to have recently achieved sales in the low to mid-single-digit million range, but still no profit. Overall, the company fell well short of original expectations – as often happens with start-ups in corporate structures.
Since Sen took over as CEO almost a year ago, there have been more changes at Fresenius than ever before in the more than 110 years since the company was founded.
Fresenius boss replaced almost the entire board
The former Siemens manager, in coordination with the supervisory board and the controlling foundation, pushed ahead with the separation from the problem-plagued dialysis subsidiary Fresenius Medical Care (FMC), focused the conglomerate that had been built up over decades on two operational pillars and replaced almost the entire board of directors.
The change is being honored on the stock market: After years of losses, Fresenius shares have risen by more than a fifth within a year – and therefore almost as strong as the leading index Dax.
“The measures introduced so far – new strategy, cost savings program, clearly formulated goals – show that after years of disappointing results, problems are now being addressed energetically,” says Florian Oberhofer from Union Investment. What is crucial is that the measures are reflected in the results in the coming quarters and years, says the portfolio manager. Especially with regard to the restructuring of the Board of Directors, Oberhofer welcomes the fact that the challenges “are being addressed with new forces”.
From the era of Sen’s predecessor as CEO, Stephan Sturm, only CFO Sara Hennicken will be on board on the Fresenius board in the future. She played a key role in shaping the realignment of Fresenius with Sen. When Labor Director Sebastian Biedenkopf’s contract expires at the end of November and FMC boss Giza leaves the Fresenius board at the end of the year with the deconsolidation of the dialysis subsidiary, the 43-year-old will be the longest-serving member of the board team, even though she herself was only appointed CFO in September 2022 .
There have been many changes at Fresenius since the manager took over almost a year ago.
(Photo: Fresenius)
Most recently, Fresenius separated a few days ago from long-time Helios CEO Francesco De Meo (59), who had grown the clinic subsidiary over more than two decades.
Even if Helios delivered good numbers, the distance between the completely different managers Sen and De Meo had recently become larger and larger and ultimately unbridgeable. The Eugin Group and Curalie were topics that De Meo in particular had pushed forward. Helios Germany boss Robert Möller, 56, joined the board in his place.
>> Read also: Fresenius replaces head of the Helios hospital division
Ernst Wastler only left the company in June – officially when he reached retirement age, but still early. The service subsidiary he was responsible for had fallen into losses due to, among other things, risky construction project transactions.
47-year-old Michael Moser has been responsible for Vamed on the board since July. Sen knows the doctor of law and business administration with an MBA from their time together at the energy company Eon. Moser has also taken over some tasks from the previous legal director Sebastian Biedenkopf. Finally, the experienced pharmaceutical and medtech manager Pierluigi Antonelli, 56, came to the Kabi drug division, which Michael Sen had reorganized as a board member since April 2021 and was in charge until February of this year.
Further sales are necessary to reduce debt
From the point of view of Cornelia Zimmermann, sustainability specialist at the fund company Deka Investment, the far-reaching changes on the board show that the management is ready to change the structures and culture of the group. “This willingness to reform was promised to investors and it is being consistently implemented. It remains to be seen whether the right decisions were made,” she says.
In any case, from his point of view, CEO Sen now has the right management team in place with which he can drive forward the realignment of the group under the motto #FutureFresenius, as he recently emphasized. This also includes the implementation of higher savings goals, improved processes and increasing profitability.
The new Fresenius – shrunk to just over half its previous size – will in future lead the way with the two core business areas Kabi (infusion medication, clinical nutrition and medical technology) as well as the clinic subsidiary Helios with strong footholds in Germany and Spain.
The smallest division, Vamed – now viewed as a financial investment – should first be brought into shape before the group explores new sales options. The unbundling of FMC is expected to be completed in the fourth quarter. The dialysis subsidiary will then operate as an independent stock corporation, with Fresenius as the main shareholder, holding 32 percent of the shares.
However, the big issue of debt remains with the new Fresenius for the time being. With recent debts of more than 13 billion euros, Fresenius without FMC expects net debt to be four times Ebitda at the end of the year. Divestments therefore remain an important means of achieving the self-imposed target corridor of debt of up to a maximum of 3.5 times Ebitda. According to Sen, selling shares in FMC is not an option for now. What remains is the sale of other peripheral activities.
“We expect that Mr. Sen will consistently continue on the course he has chosen and will continue to sell dispensable business areas if this is possible on reasonable terms. From our point of view, the goal is not growth, but improved profitability,” says Deka expert Zimmermann.
Collaboration: Arno Schütze
More: Get out of debt: How Fresenius can become sustainable again.