Thermo Fisher nears $13 billion Life Tech deal

NEW YORK, Mon Apr 15, 2013 — Thermo Fisher Scientific Inc. is nearing a deal to buy genetic testing equipment maker Life Technologies Corp. for close to $13 billion, according to four people familiar with the matter, in what would be one of the year’s biggest corporate takeovers.

The acquisition would catapult Thermo Fisher into the hot field of genetic sequencing, where researchers, drugmakers and doctors are uncovering the genetic factors underpinning diseases to better tailor treatments to the patients.

Life Technologies’ board met on Saturday to review three takeover offers. It chose Thermo Fisher over Sigma-Aldrich Corp, a maker of chemicals for research laboratories, and a private equity consortium consisting of Blackstone Group LP, Carlyle Group LP, KKR & Co. LP and Temasek Holdings, the sources said.

The final price being negotiated is in the region of $75 per share, valuing Life Technologies at close to $13 billion, one of the sources added. A deal could come as soon as Monday, though negotiations could yet fall apart as terms are being finalized.

Life Technologies, Thermo Fisher, Sigma-Aldrich and the private equity consortium did not respond to requests for comment.

Analysts have previously said the combination of Waltham, Massachusetts-based Thermo Fisher and Carlsbad, California-based Life Technologies would create an unparalleled life sciences company and put Thermo on the road to $20 billion in revenues.

Life Technologies would be Thermo Fisher’s biggest acquisition since the $12.8 billion merger in 2006 of Thermo Electron and Fisher Scientific International that created the world’s largest maker of scientific equipment and laboratory instruments.

A deal at $75 per share would represent a premium of 36 percent on Life Technologies’ closing share price on January 17, the day before it announced it had mandated Deutsche Bank AG and Moelis & Co. to assist in a strategic review.

Lab equipment maker Thermo Fisher to buy Phadia diagnostics for $3.5 billion

NEW YORK ― Laboratory equipment company Thermo Fisher Scientific Inc. agreed to acquire private-equity-owned Phadia, maker of allergy and autoimmune tests, for about $3.5 billion to expand in specialty diagnostics.

Thermo said Thursday that the deal to buy Sweden-based Phadia from European private equity firm Cinven would immediately add to earnings. The deal is expected to be completed in the fourth quarter and add 26 to 30 cents per share to 2012 earnings.

Thermo shares rose 3.6 percent to $65 in premarket trading.

“It’s a decent deal for them,” said Peter McDonald, an analyst at Auriga USA. “It fits well with their specialty diagnostics business, it leverages some of their infrastructure and it will probably do well.”

Phadia had 2010 sales of about $525 million, and has increased revenue by about 10 percent per year on average for the last three years on a constant currency basis.

Phadia specializes in in vitro allergy diagnostics and is a European leader in autoimmunity diagnostics, Thermo said.

“Thermo has very good distribution,” McDonald said. “They like to buy these products and pump them through their channels, so I think this is not a bad use of their cash. It’s expensive, but that’s what you have to pay to be in this space.”

Thermo intends to use proceeds from committed debt financing from Barclays Capital and cash on hand for the Phadia transaction.

Barclays is advising Thermo Fisher, while Goldman Sachs is acting as financial adviser to Phadia.