2007 mergers & acquisitions review.It was another year of largely bolt-on acquisitions for major analytical instrument companies. The only pure-play instrumentation deal worth more than $1 billion was Madison Dearborn's acquisition of VWR International VWR International is a global leader in the distribution of research laboratory products, with over 1,200,000 items to more than 250,000 customers in North America and Europe. The U.S. division is headquartered in West Chester, Pennsylvania. (see IBO Ibo: see Igbo. 5/15/07). However, acquisitions for companies in which laboratory instruments or associated products are one segment of the company's many businesses yielded two deals of more than $1 billion. In May, Onex Healthcare acquired Eastman Kodak's Health Group, which includes the Molecular Imaging business (see IBO 1/15/07), renaming the business Carestream Health Carestream Health, formerly Eastman Kodak Company's Health Group, is an independent subsidiary of Onex Corporation, Toronto, Canada. . CCMP CCMP Comprehensive Conservation and Management Plan CCMP Counter-Mode/CBC-Mac Protocol (IEEE 802.11I encryption algorithm) CCMP Capacitively Coupled Microwave Plasma CCMP Coalition of Concerned Medical Professionals Capital's May purchase of BOC (Bell Operating Company) One of 22 companies that was formerly part of AT&T and later organized into seven regional companies. See RBOC. Edwards, a maker of vacuum systems vacuum system Urology A mechanical system used to facilitate and maintain an erection; an erection erector. Cf Penile implant. for instruments, from Linde (see IBO 3/15/07) also topped the $1 billion mark. The company is now known as Edwards and has installed a new management team. In both cases, the analytical instrument-related portion of the businesses appears to be receiving increased attention as part of smaller companies under private equity ownership. These deals, as well as Madison Dearborn's purchase of VWR International from Clayton, Dubilier & Rice (see IBO 5/15/07), the largest pure-play acquisition of the last 12 months, illustrate private equity's continued activity in the analytical instrument and laboratory product market. Other notable private equity deals in the last 12 months were Gilde Buyout Partners BV's purchase of process chromatography firm Groupe Novasep (see IBO 12/15/06) and Nova Capital Management's acquisition of Barloworld's Scientific Laboratory Group (see IBO 10/31/07). However, with the changes in the credit markets, private equity may have a more curtailed role in 2008, tempering valuations and improving acquisition opportunities for instrument companies. IBO's annual summary of mergers and acquisitions in the analytical instrument and laboratory product-related markets is comprised of deals announced between November 16, 2006, and November 15, 2007. The summary is based on publicly available information and is compiled from merger and acquisition news reported in IBO. Last year's Thermo Fisher Scientific Fisher Scientific, formally Fisher Scientific International, Inc. and colloquially Fisher was a biotechnology company that provided products and services to the global scientific research and United States clinical laboratory markets. mega-merger raised the specter of greater consolidation among the instrument industry's major players. Yet the only major deal this year to unite two large suppliers was MDS's acquisition of Molecular Devices Molecular Devices Corporation is a leading supplier of high-performance bioanalytical measurement systems that accelerate and improve drug discovery and other life sciences research. (see IBO 1/31/07), which was the second largest pure-play acquisition in 2007. The acquisition marked a shift for MDS MDS, n See temporomandibular pain-dysfunction syndrome. MDS 1 Maternal deprivation syndrome, see there 2 Myelodysplastic syndrome, see there , whose Sciex business was previously mainly a manufacturer of products for Applied Biosystems Applied Biosystems, Inc. (formerly NASDAQ: ABIO) is the original name of a pioneer biotechnology company founded in 1981 in Foster City, California, among the Silicon Valley cities of the southern San Francisco Bay Area. and PerkinElmer. Now the company offers cellular analysis and microplate product lines, as well as sizable sales and distribution capabilities. Consolidation was also evident in Air Liquide's purchase of Scott Specialty Gases (see page 2), Thar n. 1. (Zool.) A goatlike animal (Capra Jemlaica) native of the Himalayas. It has small, flattened horns, curved directly backward. The hair of the neck, shoulders, and chest of the male is very long, reaching to the knees. Technologies' purchase of Mettler-Toledo's super fluid chromatography business (see IBO 7/15/07) and PerkinElmer's purchase of three companies that offer products for cell analysis (see IBO 11/30/06, 12/31/06, 4/15/07). However, most larger instrument companies chose to build distribution and diversify product lines through smaller bolt-on acquisitions. In particular, many companies continued to expand global business opportunities through the acquisition of distributors, including Phenomenex (see IBO 4/30/07) and VWR VWR Van Waters and Rogers VWR Viewer File (see IBO 3/31/07, 6/30/07, page 2). Other acquisitions that strengthened companies' overseas opportunities included Thermo Fisher Scientific's purchase of India's Qualigens Fine Chemicals (see IBO 7/31/07), while Eppendorf AG's purchase of New Brunswick New Brunswick, province, Canada New Brunswick, province (2001 pop. 729,498), 28,345 sq mi (73,433 sq km), including 519 sq mi (1,345 sq km) of water surface, E Canada. Scientific (see IBO 7/15/07) and Ocimum Biosolutions' purchase of Gene Logic's Genomics business (see IBO 10/15/07) gave each company a greater presence in the US market. Thermo Fisher Scientific was once again among the top five companies in the number of acquisitions made during the 12-month period. Thermo Fisher Scientific added businesses in a number of product areas, including a $70 million investment in HPLC HPLC high-performance liquid chromatography. HPLC high performance liquid chromatography. HPLC High-performance liquid chromatography Lab instrumentation A highly sensitive analytic method in which analytes are placed through the purchase of Cohesive Technologies (see IBO 12/15/07). Another company on the top five list for a second year in a row is PerkinElmer. For several companies, acquisitions diversified their product lines and end-user markets, including Genetix's purchase of Applied Imaging (see IBO 11/30/06), GE Healthcare's acquisition of Wave Biotech (see IBO 4/30/07) and AMETEK's purchase of CAMECA SAS (1) (SAS Institute Inc., Cary, NC, www.sas.com) A software company that specializes in data warehousing and decision support software based on the SAS System. Founded in 1976, SAS is one of the world's largest privately held software companies. See SAS System. (see IBO 8/15/07). Two companies whose list of acquisitions were among the most notable in terms of diversification were Agilent and Roche. Agilent acquired four companies in the past 12 months, adding Kalabie's electronic laboratory notebooks (see IBO 6/30/07), Stratagene's PCR PCR polymerase chain reaction. PCR abbr. polymerase chain reaction Polymerase chain reaction (PCR) , reagent reagent /re·a·gent/ (re-a´jent) a substance used to produce a chemical reaction so as to detect, measure, produce, etc., other substances. re·a·gent n. and diagnostic product lines (see IBO 4/15/07), and Velocity11's laboratory automation products and software to its portfolio (see page 2). The acquisitions clearly position the company for a larger stake in the life science market, as well as the creation of integrated solutions for multiple stages of the laboratory workflow. Like Agilent, Roche significantly upped its stake in the life science research market this year, becoming a notable new player in the genomics sector. The company's three instrument-related acquisitions brought the company two of the genomics field's signature technologies, DNA sequencers and microarrays, while its purchase of BioVeris gave it additional research and clinical reagents. Roche's acquisitions of BioVeris (see IBO 4/30/07), NimbleGen Systems (see IBO 6/30/07) and 454 Life Sciences (see IBO 3/31/07) were also among the top five deals in terms of premiums paid. Roche's acquired technologies are also distinguished by their diagnostic capabilities. Diagnostics companies were another hot area for instrument company acquisitions this year. QIAGEN NV's $1.5 billion purchase of Digene (see IBO 6/15/07) was among the biggest deals of the year. Agilent's purchase of Stratagene (see IBO 4/15/07), PerkinElmer's acquisition of ViaCell (see IBO 10/15/07), Luminex's Tm Bioscience transaction (see IBO 12/15/06), Genetix's purchase of Applied Imaging (see IBO 11/30/07) Cepheid's buyout of Sangtec Molecular Diagnostics AB (see IBO 2/15/07) and Carl Zeiss
Carl Zeiss (September 11, 1816 – December 3, 1888) was an optician commonly known for the company he founded, Zeiss. AG's purchase of selected Clarient assets (see IBO 3/15/07) are also examples of investments in diagnostic-related technologies and products in the past 12 months. The acquisitions illustrate the growing role of research instrument providers in the molecular diagnostics and pathology markets. Another adjacent market in which instrument and laboratory product companies continue to expand their stake is bioprocess bi·o·proc·ess n. 1. A technique that produces a biological material, such as a genetically engineered microbial strain, for commercial use. 2. . Sartorius AG (see IBO 2/28/07), GE Healthcare GE Healthcare is a $18 billion (USD) unit of General Electric (GE). It employs more than 46,000 people worldwide and is headquartered in Chalfont St. Giles, Buckinghamshire, United Kingdom. GE Healthcare is the first GE business segment headquartered outside the United States. (see IBO 4/30/07) and IDEX IDEX International Development Exchange IDEX Imagery Data Exploitation System IDEX Imagery Digital Exploitation (system) IDEX Identifier of Explorer (see IBO 6/15/07) were among the instrument and lab product companies purchasing bioprocess-related businesses this year. Sartorius and GE Healthcare's deals both focused on disposable equipment for biopharmaceutical manufacturing. Another technology segment with multiple acquisitions was materials testing Articles on Materials testing include:
n. 1. Measurement of the refractive index of a substance with a refractometer. 2. Use of a refractometer in determining the refractive error of the eye. companies. These acquisitions were relatively small investments, but show the continuing interest in industrial applications.
Top 5 Largest Instrument and Laboratory Product Related Acquisitions
in 2007
Acquired
Co.'s
Purchase Annual
Purchaser Acquired Price ($M) Sales ($M)
Madison Dearborn VWR International $3,600.0 $3,260.0
Partners
Onex Healthcare Eastman Kodak's Health $2,350.0 $2,540.0
Holdings Group
QIAGEN NV Digene $1,500.0 $155.0
CCMP Capital BOC Edwards (Vacuum & $901.1 N/A
Semicon.)
MDS Sciex Molecular Devices $615.0 $186.4
Top 5 Premiums Paid in 2007 for Companies with Sales Over $10 Million
Acquired
Co.'s
Purchase Annual Price to
Purchaser Acquired Price ($M) Sales ($M) Sales Ratio
Roche BioVeris $600.0 $24.1 24.9
Roche NimbleGen Systems $273.0 $13.5 20.2
QIAGEN NV eGene $34.0 $2.8 12.1
QIAGEN NV Digene $1,500.0 $155.0 9.7
Roche 454 Life Sciences $154.9 $19.4 8.0
Top 5 Largest Pure-Play Instrument and Laboratory Product Related
Acquisitions in 2007
Acquired
Co.'s
Purchase Annual
Purchaser Acquired Price ($M) Sales ($M)
Madison Dearborn VWR International $3,600.0 $3,260.0
Partners
MDS Sciex Molecular Devices $615.0 $186.4
Roche BioVeris $600.0 $24.1
Gilde Buyout Groupe Novasep $561.0 $380.0
Partners BV
Roche NimbleGen Systems $273.0 $13.5
Top 5 Best Values in 2007 for Companies with Sales Over $10 Million
Purchase
Purchaser Acquired Price ($M)
Ocimum Biosolutions Gene Logic's Genomics business $10.0
VWR International KMF Laborchemie Handels GmbH $21.4
Onex Healthcare Holdings Eastman Kodak's Health Group $2,350.0
Vector Capital Tripos's Discovery Informatics $26.2
Enzo Life Sciences Axxora Life Sciences $16.3
Acquired Co.'s
Annual Price to
Purchaser Sales ($M) Sales Ratio
Ocimum Biosolutions $24.3 0.4
VWR International $45.0 0.6
Onex Healthcare Holdings $2,540.0 0.9
Vector Capital $27.4 1.0
Enzo Life Sciences $16.0 1.0
Most Instrument and Laboratory Product
Related Acquisitions in 2007
Number of
Company Acquisitions
Thermo Fisher Scientific 7
PerkinElmer 5
Agilent Technologies 4
Roche 3
Ocimum Biosolutions 3
VWR International 3
Value of Top 5 Instrument and Laboratory
Product Related Acquisitions
$Millions
2nd-5th Largest Largest
Acquisitions Acquisition
2005 $4,818 $1,350
2006 $2,950 $10,600
2007 $5,366 $3,600
Note: Table made from bar graph.
|
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion