Danaher speeds up restructuring, acquires life-sciences businesses
Rick Nelson, Editor-in-Chief -- Test & Measurement World, 9/2/2009 8:37:00 AM
Danaher, the parent company of test-and-measurement companies including Fluke and Tektronix, announced today that it plans to accelerate its 2009 restructuring activities, which are now anticipated to total $225 to $250 million. The company also said it would acquire the life sciences instrumentation businesses from MDS Inc. and Life Technologies.
Danaher announced that the restructuring activities are expected to provide annual costs savings of approximately $220 million through the elimination of approximately 3300 positions and 30 facilities. Danaher had previously estimated total restructuring costs of $150 to $170 million in 2009.
Danaher’s president and CEO, H. Lawrence Culp, Jr., said, "We are optimistic about the continuing signs of stabilization that we have seen during the first two months of the third quarter. We are also encouraged with the sequential improvement in order activity in some of our businesses. We believe that these additional 2009 restructuring activities will deliver improved results for us in 2010 and beyond."
With respect to the acquisitions, Danaher announced that it has signed a definitive agreement with MDS Inc. to acquire the Analytical Technologies division of MDS, which includes a 50% ownership position in the Applied Biosystems/MDS Sciex joint venture (AB SCIEX), a mass-spectrometry business, and a 100% ownership position in the former Molecular Devices Corp., a bioresearch and analytical instrumentation company. In a separate, but related transaction, Danaher also announced that it has signed a definitive agreement with Life Technologies Corp. to acquire the remaining 50% ownership position in AB SCIEX. After completion of both transactions, Danaher will own outright AB SCIEX and Molecular Devices. The aggregate purchase price for the combined transactions is $1.1 billion, including debt assumed and net of cash acquired.
AB SCIEX 's mass spectrometers serve applications including proteomics research, drug development, food and environmental safety testing, and diagnostics testing. Customers include academic and research institutions, pharmaceutical development labs, testing and reference labs, and hospitals. Molecular Devices supplies high-performance bio-analytical instrumentation systems and consumables that accelerate and improve research productivity and effectiveness in life-science research and drug discovery.
The acquired businesses will operate within Danaher’s Medical Technologies segment, joining Danaher’s Leica, Radiometer, Sybron, and KaVo businesses, and will expand the segment’s annual revenues by more than $650 million, the company reported, adding that the acquired businesses will increase Danaher’s life sciences and diagnostics annual revenues to more than $2 billion.
Culp said, “AB SCIEX is the market leader in mass spectrometry and its instruments address the needs of a broad scientific community involved in many applications including the research, applied and clinical markets. Additionally, Molecular Devices is known for high-quality, innovative products in the segments it serves. We are excited about the opportunity to acquire two leading brands in the life sciences instrumentation market, which will complement our existing Medical Technologies businesses and present an attractive value creation opportunity.”
The transaction with MDS Inc. is subject to approval of the MDS shareholders. Both transactions are subject to regulatory approval and customary closing conditions, including the absence of material adverse change with respect to the acquired businesses. Danaher expects the transactions to close in the fourth quarter of 2009.
www.danaher.com
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