Issue Date: February 14, 2011
Danaher Will Buy Beckman Coulter
Danaher has agreed to acquire biomedical and lab automation equipment maker Beckman Coulter for $6.8 billion in cash and debt. Danaher is a diversified holding company that owns businesses as varied as microscopes, water treatment technologies, and hand tools.
Danaher’s $83.50-per-share offer for Beckman represents a 45% premium on the closing price of Beckman’s stock on Dec. 9, 2010, the day before rumors of a sale began. With annual revenues of some $3.7 billion, Beckman sells laboratory equipment for diagnostics and drug discovery.
In recent years, Danaher has been adding to its life sciences and diagnostics segment. In September 2009, the company paid $1.1 billion to acquire mass spectrometry firm AB Sciex from its two owners, MDS and Life Technologies. The purchase pushed Danaher into the top 10 among global instrumentation firms (C&EN, April 26, 2010, page 22).
That deal set off a busy season for instrumentation acquisitions. In May 2010, Agilent Technologies completed its $1.5 billion acquisition of Varian, part of a strategy to boost its exposure to the analytics and life sciences markets. And in December 2010, Thermo Fisher Scientific said it would pay $2.1 billion to buy Dionex, a leader in liquid and ion chromatography.
Beckman’s focus on the life sciences is fairly recent. The company was founded in 1935 to sell the first commercial pH meter, invented by Arnold O. Beckman. In 1997, it acquired Coulter and its blood-testing instruments. Beckman expanded into clinical chemistry systems in 2009. But the firm’s fortunes dipped last June when it received an FDA warning letter saying it did not seek proper approval to sell a biomarker assay for acute myocardial infarction. The company’s CEO, Scott Garrett, unexpectedly resigned in September.
Life sciences companies are attractive targets for Danaher because it looks for fast-growing, technology-based businesses that bring high margins and an opportunity for international growth, says Efraim Levy, an equities analyst at Standard & Poor’s. In addition, Levy points out, “Beckman has some similarities to Danaher’s own businesses.”
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