REUTERS: Danaher Corp said on Tuesday it would buy molecular diagnostics company Cepheid in a deal valued at US$4 billion, including debt, to strengthen its diagnostics unit.
Danaher will pay Cepheid US$53 per share in cash, a premium of 54 percent to its Friday close of US$34.42, and the transaction is expected to close in the fourth quarter.
The company, which develops healthcare and environmental technology, said the addition of Cepheid would improve operational efficiencies and expand margins in its US$5 billion diagnostics segment.
Sunnyvale, California-based Cepheid’s GeneXpert systems enable genetic testing and provide test results for infectious diseases, among other clinical applications.
Danaher expects the acquisition to add about 30 cents to adjusted earnings in the fifth full year after the deal closes.
The equity value of the deal was US$3.86 billion based on 72.9 million outstanding Cepheid shares as of June 30.
Fenwick & West is acting as Cepheid’s legal adviser for the transaction, and Goldman Sachs is acting as Cepheid’s financial adviser.
Cepheid’s stock was up about 52.5 percent at US$52.50, just shy of the US$53 offer price in light premarket trading.
(Reporting by Natalie Grover and Ankur Banerjee in Bengaluru; Editing by Shounak Dasgupta)