Agilent Technologies, ITT and Merck KGaA each completed major analytical instrument or laboratory product acquisitions within the last year. IBO spoke with each company about the challenges related to and new opportunities resulting from the acquisitions.

Merck completed its $7.0 billion purchase of Millipore in July 2010 (see IBO 2/28/10). According to Jon DiVincenzo, head of EMD Millipore’s Bioscience Business Unit and former president of the Bioscience Division of Millipore, the greatest challenge involved in integrating the companies was the “balancing of priorities” and learning to communicate within a new structure. The integration process was driven by a “best of both worlds” strategy, which brought together the strongest attributes of each organization. The acquisition also provided the Bioscience business with direct access to EMD Serono’s expertise, which can be applied to product development. Fueling future product development is a combined R&D organization with the third-largest funding in the life sciences industry, he said. Mr. DiVincenzo told IBO that the combined organization operates in 67 countries and offers more than 40,000 products, with product lines spanning drug discovery through drug production.

For Mike McMullen, head of Agilent’s Chemical Analysis Group, one of the greatest challenges for him regarding his company’s acquisition of Varian was created by the period of time between when the acquisition was announced in July 2009 (see IBO 7/31/09) and when it closed in May 2010 (see IBO 5/15/10). “Probably the biggest challenge was just to keep the lines of communications open during the transition period,” he told IBO. He emphasized the complementary nature of the two companies as a factor that minimized the challenges he faced. “The fact that it was complementary and it was additive—we were adding portfolio, we were adding people—it was complementary, so there wasn’t this need to have this massive restructuring, headcount changes, etc.” Agilent is now investing in the acquired businesses, which include investments in sales channels and R&D. “Our strategy is we’re going to put money in and grow these businesses,” said Mr. McMullen.

ITT Analytics was formed following ITT’s purchase of Nova Analytics (see IBO 2/28/10) and OI (see IBO 9/15/10). Analytical instruments is a new business for ITT, an $11 billion company. According to Chris McIntire, president of ITT Analytics and former president of Nova Analytics, “The single biggest challenge was to expand our time and opportunity horizons and consider the larger possibilities for our business. Being a key part of ITT has given us the challenge and opportunity to accelerate our growth plans.”

Nova Analytics’ companies have retained their brand names and operations. Asked how the former Nova Analytics businesses capitalize on being part of ITT, Mr. McIntire told IBO, “Despite the soft but improving economy, the former businesses of Nova Analytics and ITT have each had a great year. Our customers, strategic partners and suppliers are excited and engaged.“