Thermo Fisher Scientific to Acquire Life Technologies Corporation
WALTHAM, MA and CARLSBAD, CA – Thermo Fisher Scientific (NYSE: TMO), the world leader in serving science, and Life Technologies Corporation (NASDAQ: LIFE), a leading life sciences company, have signed a definitive agreement under which Thermo Fisher will acquire Life Technologies for $76.00 in cash per fully diluted common share, or approximately $13.6 billion, plus the assumption of net debt at close ($2.2 billion as of year end 2012).
The transaction, which was approved by both companies’ boards of directors, will create an unrivaled leader in serving research, specialty diagnostics and applied markets. The combination builds on both companies’ technological strengths to accelerate results for life sciences customers working in proteomics, genomics and cell biology.
“We are extremely excited about this transaction because it creates the ultimate partner for our customers and significant value for our shareholders,” said Marc N. Casper, president and chief executive officer of Thermo Fisher Scientific. “The acquisition of Life Technologies enhances all three elements of our growth strategy: technological innovation, a unique customer value proposition and expansion in emerging markets.
“Our customers in research and applied markets will now be able to achieve even higher levels of innovation and productivity by working with the combined company. We’re especially excited about the new opportunities we will have to leverage our complementary offerings, fueled by a shared commitment to continuous innovation. For our shareholders, we expect the transaction to generate attractive financial returns, as well as significant and immediate accretion to our adjusted EPS.”
Gregory T. Lucier, chairman and chief executive officer of Life Technologies, said, “This transaction brings together two companies intent on accelerating innovation for our customers and achieving greater success in a highly competitive global industry. Further, this combination delivers immediate and significant cash value to our stockholders and represents a successful conclusion to the board’s strategic review to enhance stockholder value and develop an even stronger future for Life Technologies. We look forward to joining forces with the outstanding team at Thermo Fisher, which shares our commitment to customers, employees and the communities we serve.”
Casper added, “We look forward to welcoming our new colleagues from Life Technologies to the Thermo Fisher team. Together, we will be in an even stronger position to fulfill our company’s mission, which is to enable our customers to make the world healthier, cleaner and safer.”
Life provides innovative products and services to customers conducting scientific research and genetic analysis, as well as those in applied markets, such as forensics and food safety testing. With 2012 revenues of $3.8 billion, its comprehensive offering includes a broad range of reagents, consumables, instruments and systems. Life’s leading technologies are protected by approximately 5,000 patents and licenses, and it builds on this position through a strong commitment to innovation. Life has an expansive commercial presence and global footprint as well, with more than 10,000 employees serving its customers around the world.
It is expected that Life Technologies’ president and chief operating officer, Mark P. Stevenson, will have a significant leadership role in the combined company. In addition, Thermo Fisher intends to elect a member of the Life Technologies board of directors to the Thermo Fisher board.
Benefits of the Transaction
The acquisition of Life Technologies will create enhanced scale and depth of capabilities for customers working in research, specialty diagnostics and applied markets.
· Strengthens technology and innovation leadership through complementary offerings that broaden Thermo Fisher’s industry-leading portfolio. Life has an extensive offering of consumables for genomics, and molecular and cell biology. It is well-known for its next-generation sequencing capability, and also has a range of technologies for bioproduction and forensics applications. These strengths, combined with Thermo Fisher’s leading offerings in analytical technologies and specialty diagnostics, create new opportunities to support the convergence of life sciences tools and diagnostics.
· Creates the ultimate customer partner, enhancing Thermo Fisher’s commercial strength and global reach. Life transacts more than half of its orders online through a highly regarded e-commerce platform. This leading capability, combined with Thermo Fisher’s extensive research and healthcare customer channels, creates a world-class commercial infrastructure. The combined company will also build on its strong foothold in Asia-Pacific, particularly in China, to meet increasing customer demand in life sciences and healthcare.
· Creates compelling value for shareholders, with attractive financial returns and new growth opportunities. The acquisition of Life presents the opportunity for $275 million of adjusted operating income synergies in year three following the close, consisting of $250 million of cost synergies and $25 million of revenue synergies. In addition, Thermo Fisher expects the transaction to be significantly and immediately accretive to adjusted EPS.
Financing and Approvals
Thermo Fisher will acquire Life for $76.00 in cash per fully diluted common share. The transaction, which is expected to close early in 2014, is subject to a Life shareholder vote and satisfying customary closing conditions, including regulatory approvals. Thermo Fisher has obtained committed bridge financing from J.P. Morgan and Barclays. Of the $13.6 billion of total cash consideration, the company expects the split to be cash and debt of $9.5 to $10.0 billion and equity of up to $4.0 billion. Thermo Fisher expects to maintain an investment-grade rating after the transaction has closed.
About Thermo Fisher Scientific
Thermo Fisher Scientific is the world leader in serving science. Our mission is to enable our customers to make the world healthier, cleaner and safer. With revenues of $13 billion, we have approximately 39,000 employees and serve customers within pharmaceutical and biotech companies, hospitals and clinical diagnostic labs, universities, research institutions and government agencies, as well as in environmental and process control industries. We create value for our key stakeholders through three premier brands, Thermo Scientific, Fisher Scientific and Unity Lab Services, which offer a unique combination of innovative technologies, convenient purchasing options and a single solution for laboratory operations management. Our products and services help our customers solve complex analytical challenges, improve patient diagnostics and increase laboratory productivity. Visit www.thermofisher.com.
About Life Technologies
Life Technologies Corporation is a global biotechnology company that is committed to providing the most innovative products and services to leading customers in the fields of scientific research, genetic analysis and applied sciences. With a presence in more than 180 countries, the company's portfolio of 50,000 end-to-end solutions is secured by more than 5,000 patents and licenses that span the entire biological spectrum – scientific exploration, molecular diagnostics, 21st century forensics, regenerative medicine and agricultural research. Life Technologies has approximately 10,000 employees and had sales of $3.8 billion in 2012.