Corning to Buy Majority of BD Discovery Labware
The acquisition boosts the size of Corning’s Life Sciences business, which will help offset declining growth in its LCD business, according to analysts. The company commented that the acquired business is in a “low capital intensity” industry and will provide a “stable stream of incremental cash flow.” Discovery Labware sales grew 3.5% in fiscal 2011. According to a November 2011 BD presentation, currency-neutral sales for Discovery Labware were flat in 2011, excluding Japanese supplemental spending and US stimulus spending.
Corning, NY 4/10/12; Franklin Lakes, NY 4/10/12—Corning has definitively agreed to acquire the majority of BD’s (Becton, Dickinson and Company) Discovery Labware unit for $730 million in cash. Corning Life Sciences will acquire four platforms: plastic consumables labware, liquid handling products, cell-based assays and cell cultureware, and ADME research. BD will maintain ownership of its Advanced Bioprocessing platform. In fiscal 2012, the acquired asset group is forecast to have sales of $235 million. “The Discovery Labware unit’s extensive product portfolio and established dealer network will significantly improve Corning Life Sciences’ offerings to customers and is a critical part of Corning’s long-term growth strategy,” stated Corning Chairman, CEO and President Wendell P. Weeks. “With sales of approximately $235 million, the acquisition will expand Corning Life Sciences’ annual revenues by 40% and catapult the segment toward its goal of being a $1 billion business by 2014.” The acquisition is expected to be slightly accretive in 2013. When the full integration is completed by 2016, it is expected to grow EPS by $0.05, excluding purchased intangibles amortization. BD stated that acquisition would enable it to focus on its recent Biosciences acquisitions and new instruments. BD forecasted the divested asset to be associated with $0.23–$0.27 EPS in fiscal 2012.
