Molecular Devices Purchase to Transform MDS Sciex
The acquisition is forecasted to be modestly accretive in 2007 and significantly accretive in 2008 and beyond. MDS expects $10–$12 million in cost synergies. The acquisition is expected to close in the second quarter. MDS’s three businesses are Sciex, Nordion, a provider of medical isotopes, and Pharma, its contract research organization business. Thus, the Molecular Devices acquisition fits with MDS’s customer base. It gives Sciex a sales and marketing organization as well as new R&D resources and insight into the life sciences market. MDS President Stephen D. Falco stated the acquisition will not affect Sciex’s manufacturing partnership with Applied Biosystems and PerkinElmer.
Sunnyvale, CA and Toronto, Canada 1/29/07—MDS has signed a definitive agreement to purchase Molecular Devices for $615 million in cash, or $35.50 per share, a 49% premium over the January 26 trading price. In the first 12 months, the acquisition is expected to add $190 million in revenues and $45–$50 million in EBITDA (earnings before interest, taxes, depreciation, amortization). Molecular Devices will combine with MDS’s Sciex business to create a new business unit led by MDS Sciex President Andy Boorn. The companies will keep their respective brand names. MDS’s $3 billion Sciex business manufactures mass spectrometers for Applied Biosystems and PerkinElmer, ICP-MS systems for PerkinElmer and sells the CellKey cell analysis system. Following the acquisition, Sciex’s share of MDS revenues will increase from 26% to 38%.
