Printer Friendly

QIAGEN sells synthetic DNA business in management buyout.

Venlo, The Netherlands 6/30/04 -- QIAGEN has sold its synthetic DNA business and assets to the former management team for a consideration of approximately $23.4 million effective June 30. Renamed Operon Biotechnologies, the spinoff is headed by Patrick A. Weiss, a QIAGEN vice president and founder of Xeragon, which QIAGEN acquired in 2002 (see IBO 4/30/02). QIAGEN will retain a 16% minority stake and will receive preferred access to Operon's synthetic nucleic acid manufacturing capacities and purchasing rights, as well as exclusive rights to utilize its manufacturing capacities. QIAGEN retains its siRNA business, and Operon will manufacture siRNA and miRNA exclusively for QIAGEN. "Oligonucleotides have always been a flanking business to QIAGEN and in recent years were exposed to a significantly volatile market environment and lower margins. In 2003 we were able to turn this business from a loss-contributor to a profitable unit that stands strong today. However, we believe that the market dynamics and strategic directions this business is moving into have become different in nature compared to the markets and path QIAGEN intends to focus on," commented QIAGEN CEO Peer M. Schatz. The oligonucleotide business was forecasted to contribute around 10% of QIAGEN's net sales and 7% of its operating profit in 2004. QIAGEN revised its guidance for the third quarter from between $101 million and $102 million to between $89 million and $92 million. For the fourth quarter, guidance was revised to $92 million to $95 million, down from $105 million to $107 million.

For both the third and fourth quarters QIAGEN revised the high end of its operating margin upward by one percentage point and revised its EPS downward by one cent According to QIAGEN, the spinout will improve its margins, lead to lower volatility and increased brand equity. Operon will consist of QIAGEN's former custom and modified oligo businesses, shelf products (Array Ready Oligo Sets) and antibody and peptide business, and includes the transfer of QIAGEN Sciences KK (formerly Sawady) QIAGEN Operon GmbH (Cologne) and QIAGEN Operon's Alameda, California and Germantown, Maryland operations QIAGEN noted that the Operon business is different due to its mostly nonproprietary products, custom-made products, fast turn around times and low competitive barriers QIAGEN states that Operon is the number two competitor in the oligo market in the US, Europe and Japan.
COPYRIGHT 2004 Strategic Directions International Inc. (SDI)
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2004 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Title Annotation:Executive briefing: news, trends & market intelligence for instrument executives
Publication:Instrument Business Outlook
Geographic Code:1USA
Date:Jun 30, 2004
Previous Article:Applied bio gets injunction against Bio-Rad and grants Cepheid license.
Next Article:Teledyne completes ISCO acquisition and exits SFE business.

Related Articles
Random samples: companies.
Protein array systems proliferate.
Double-digit Q4 sales growth for instrument sales index.
Life Science sales growth slows but profits soar again.
Life science instrumentation: dynamic growth.
2006 acquisitions: one big deal and many little ones.
Instrument firms test diagnostics market.
The top 30 companies of 2007.
2007 mergers & acquisitions review.

Terms of use | Privacy policy | Copyright © 2020 Farlex, Inc. | Feedback | For webmasters