Gen-Probe Inc. is expanding its diagnostics by acquiring all shares of UK diagnostics company Tepnel Life Sciences plc in a deal valued at $132.2 million.

Both companies' boards of directors have unanimously approved the transaction, and Tepnel said its board intends to recommend that its shareholders approve the deal, which is expected to close in the second quarter.

Directors and institutional investors holding about 40 percent of Tepnel's outstanding shares have pledged to vote for it.

San Diego-based Gen-Probe's offer is a 126 percent premium to Tepnel's closing share price on Jan. 21, the last trading day before Tepnel announced it was involved in acquisition discussions. Net of cash and debt, Manchester, UK-based Tepnel expects to receive about $118.5 million from the deal.

On a non-GAAP basis, Gen-Probe expects the acquisition to be neutral to its 2009 earnings per share, and accretive to its 2010 EPS.

Gen-Probe gains Tepnel's human leukocyte antigens testing products, which it hopes will facilitate its diversification into the transplant typing market. HLA testing is used to match donors and recipients in anticipation of transplant surgeries, as well as in managing transplant recipients. Tepnel also sells xMAP multiplex assays in the field of transplant diagnostics under its development and supply agreement with Luminex.

Gen-Probe said it believes that Tepnel's genetic disease testing business will complement its molecular diagnostics activities. Tepnel sells genetic tests for cystic fibrosis, Down's syndrome and familial hypercholesterolemia, among others.

Tepnel's pharmaceutical services business has master service agreements with several major pharmaceutical companies, and Gen-Probe said its ownership will strengthen those relationships. In addition, Tepnel has an opportunity to expand into the emerging market for companion diagnostics.