US-based science and technology company Danaher has agreed to acquire US-based molecular diagnostics company Cepheid for an approximate value of $4bn including indebtedness and net of acquired cash.
Subject to customary closing conditions and other regulatory approvals, the transaction is slated to be completed at the end of this year.
The transaction has secured unanimous approval from the Board of Directors of both the companies with the Cepheid Board of Directors insisting the Cepheid shareholders agree to the transaction.
Danaher president and CEO Thomas Joyce Jr said: "We expect Cepheid to be an excellent complement to our existing Diagnostics businesses and to expand our runway for growth across the platform.
“Cepheid's extensive installed base, test menu and innovative product offering contribute to its market leadership in molecular diagnostics and we expect it to strengthen our position in this high-growth segment.
"By applying the Danaher Business System and combining Cepheid with our existing $5bn revenue position in the diagnostics industry, we believe that Cepheid will be well-positioned to improve operational efficiencies, significantly expand margins and drive long-term growth.”
The potential transaction will add to Danaher’s existing Diagnostics segment, comprised of the Company's Beckman Coulter, Leica Biosystems and Radiometer businesses, with Cepheid's fully automated GeneXpert systems.
The GeneXpert systems, with its modular configuration, feature scalability and run rapid, sophisticated genetic testing to provide test results helps to manage infectious diseases.
The Cepheid shares are valued at $53 and Danaher is planning to finance the transaction with its available capital and proceeds from the issuance of debt.
During the transaction, Cepheid is being assisted by Fenwick & West as the legal advisor and Goldman, Sachs & Co as the exclusive financial advisor.