A Diagnostics & Imaging Week
Thermo Electron (Waltham, Massachusetts) reported that it has entered into a definitive agreement to acquire the Kendro Laboratory Products division of SPX (Charlotte, North Carolina) for $833.5 million in cash, subject to a post-closing balance sheet adjustment.
Thermo has received a commitment for a credit facility of $600 million to finance a portion of the purchase price. The transaction is subject to regulatory approvals and other customary closing conditions.
SPX said it expects after-tax net proceeds from the transaction to be about $675 million and intends to use the net proceeds to pay down debt and buy back equity.
Kendro makes a range of laboratory equipment for sample preparation, processing and storage used primarily in life sciences and drug discovery laboratories as well as in clinical laboratories.
Kendro's centrifuge offerings, known to customers by names such as Sorvall and Heraeus, cover applications ranging from the separation of DNA to the separation of whole cells for use in biochemistry, molecular biology, virology, diagnostics and other clinical and research applications.
The company's thermal equipment offerings include ovens, incubators, freezers and refrigerators for research and industrial applications, marketed under the brands Revco and Jewett. In addition to equipment solutions, Kendro provides its customers with comprehensive services through a global network of technicians, and offers integrated validation services and bio-repositories for sample storage and laboratory relocation management.
"As a company, Thermo is focused on providing total laboratory solutions and services to address our customers' needs, and Kendro's technologies nicely complement our existing portfolio of products and services," said Marijn Dekkers, president and CEO of Thermo Electron. "The combined company allows us to deliver even greater value to our customers by creating a broader offering of laboratory and sample preparation technologies, as well as enhanced laboratory service capabilities."
Thermo Electron is a leading maker of analytical instruments.
Sigma-Aldrich (St. Louis) reported that it has agreed to acquire the JRH Biosciences division (Lenexa, Kansas) of CSL Ltd. (Melbourne, Australia) for $370 million in cash.
JRH is a global supplier of cell culture and sera products to the biopharmaceutical industry, with 2004 sales of about $150 million, which it predicts to increase by an estimated 10% in 2005.
David Harvey, Sigma-Aldrich's chairman and CEO, said the purchase "enhances our overall position in the broad life science research market. With JRH's history of profitable sales growth, its addition is expected to help us meet or exceed our long-term growth and return goals."
JRH has manufacturing facilities in the U.S., Europe and Australia, and serum collection and processing centers in the U.S. and Australia. Product lines include sera, cell culture media used in the production of therapeutic proteins, reagent growth factors and biological material containers. The company has about 400 employees.
As much as 10 months of JRH's operating results will be added to Sigma-Aldrich's performance in 2005, it said, depending on the deal closing date, is expected to be accretive to earnings after 2005, and to make a positive contribution to cash flow in 2005 and after.
Sigma-Aldrich said it would fund the purchase through a combination of existing cash, short-term debt and three-year term debt. Goldman, Sachs & Co. acted as financial advisor to Sigma-Aldrich for the transaction.
Sigma-Aldrich manufactures biochemical and organic chemical products and kits used in scientific and genomic research, biotechnology, pharmaceutical development, the diagnosis of disease and in chemical manufacturing.
In other dealmaking news:
The Viasys MedSystems business unit of Viasys Healthcare (Conshohocken, Pennsylvania), a provider of enteral feeding devices, reported acquiring substantially all of the assets of Navion Biomedical (Stoughton, Massachusetts), manufacturer of the Navigator Bionavigation system.
The Navigator system is designed to facilitate the correct placement of peripherally inserted central catheters (PICCs) and central venous catheters. More than 1.2 million PICC lines are inserted in the U.S. annually.
"Since PICCs are currently placed without the assistance of a guiding device, their placement must be verified by X-ray," said Tom Kuhn, president of Viasys MedSystems. "PICC lines frequently need to be repositioned before proceeding with the administration of the drug or nutrition therapy. Repositioning and the additional confirmatory X-rays add significant cost to patient care and increase the time the patient is without the therapy. The Navigator system permits bedside determination of the position and direction of the catheter tip and eliminates the need for repositioning and additional confirmatory X-rays."
Viasys' business is conducted through its Respiratory Care, NeuroCare, MedSystems and Orthopedics business units.