Happy alone Qiagen changes course after Thermo Fisher offers to buy it in $11.5B deal
Dutch diagnostics company Qiagen — which is developing tests for the ongoing coronavirus epidemic — is being acquired by US-based scientific instruments maker Thermo Fisher Scientific in a deal valued at $11.5 billion, including debt.
The announcement comes months after the Netherlands-based company, which is listed on the NYSE, notified investors that it was reviewing potential strategic alternatives after it received several “indications of interest” for an acquisition. But by December, it concluded it would prefer to go it alone.
The deal will boost Massachusetts-based Thermo Fisher’s specialty diagnostics platform that includes allergy and autoimmunity, transplant diagnostics and clinical oncology testing with molecular diagnostics, particularly for infectious diseases.
“The acquisition brings about strong samples prep capabilities to TMO in addition to molecular diagnostics and infectious disease testing — including a leading TB testing franchise,” SVB Leerink’s Puneet Souda wrote in a note, adding that the deal should further lever Thermo Fisher to Covid-19.
The deadly coronavirus epidemic has culminated in 3,000 deaths and cases have topped 90,000. Qiagen — which provided equipment during the SARS and swine flu outbreaks — said it had shipped test kits for the novel coronavirus to four hospitals in China for evaluation days ago.
Thermo Fisher makes and distributes scientific equipment, consumables, and services used by pharma & biotech, diagnostics & healthcare companies, academic & governmental organizations, as well as industrial companies. Its instruments and reagents are employed in the CDC-approved assay protocol for the detection of Covid-19.
The company, which has completed seven $1+ billion deals in the past decade, is set to pay €39 a share for Qiagen. That works out to a premium of 23% to Qiagen’s Monday closing.
The $11.5 billion deal also includes the assumption of $1.4 billion of net debt. The transaction, expected to close in the first half of next year, has been approved by both boards.
This largely speculated Qiagen acquisition should have a limited impact on other large-cap companies in the life science tools market, Souda added.
For Qiagen, the buyout follows its strategic shift last year that saw it cease developing its own next-generation genome-sequencing machines to instead collaborate with bellwether Illumina, which led to the departure of its long-time CEO.
Qiagen, which generated 2019 revenue of more than $1.5 billion, has built a suite of genomic analytic products based on technology engineered to extract, isolate and purify DNA, RNA and proteins from a wide range of biological samples.