Thermo Fisher Scientific to Acquire Qiagen in US$ 11.5 Billion Deal

By Rajaneesh K. Gopinath, Ph.D.

Today, Thermo Fischer Scientific announced its agreement to acquire Qiagen for €39 (US$ 43.6) per share amounting to a total worth US$ 11.5 billion, including US$ 1.4 billion in net debt. Thermo Fisher is paying a 23% premium on Qiagen’s stock price when trading closed March 2nd. “We are excited to bring together our complementary offerings to advance our customers’ important work, from discovery to diagnostics,” said Marc N. Casper, chairman, president, and CEO of Thermo Fisher Scientific. “This acquisition provides us with the opportunity to leverage our industry-leading capabilities and R&D expertise to accelerate innovation and address emerging healthcare needs. For shareholders, we expect the transaction to be immediately accretive and to generate significant cost and revenue synergies.”

Thermo Fischer itself is an outcome of the merger between Thermo Electron Corporation and Fisher Scientific International Inc. almost 14 years ago. Since then, the Waltham, MA based company has expanded its capabilities and services, namely, sequencing, bioprocessing, viral vector manufacturing, etc. through several acquisitions. The buyout deals include several well-known companies like Affymetrix (2016), Patheon (2017) and Brammer Bio (2019). But the biggest catch of all until today’s announcement was the acquisition of Life Technologies Corporation in 2014 for US$ 13.6 billion.

Qiagen is a leading provider of molecular diagnostics and sample preparation technologies with a working force of 5,100 people operating in more than 25 countries. Its sample prep and assay kits are used all over the world to isolate and amplify biological samples. It also offers several automated instruments accompanied with bioinformatics systems providing customers with in-depth analytical insights. Last week, it announced the shipment of its newly developed QIAstat-Dx Coronavirus test kit to four hospitals in China for evaluation.

However, Qiagen is coming off a lean 2019. The buyout could be partly attributed to its dip in stock market last October, when it’s third quarter earnings took a hit following reduced sales in China. Besides, Qiagen’s 27-year veteran Peer M. Schatz, who served as CEO for 15 years, quit from his position around the same time.

Thermo Fischer seems to have found an opportunity in all this and was rumored to have approached Qiagen with an acquisition deal sending the latter’s stock value on the up again. By mid-November, Qiagen admitted that it received several conditional, non-binding indications of interest but the talks did not materialize. It seems like deliberations in the past couple of months have yielded Thermo Fisher it’s prize.

“Our vision at QIAGEN has always been to make improvements in life possible with our differentiated Sample to Insight molecular testing solutions,” said Thierry Bernard, interim CEO of QIAGEN and senior vice president, head of the molecular diagnostics business area. “This strategic step with Thermo Fisher will enable us to enter a promising new era and will give our employees the opportunity to have an even greater impact. The combination is designed to deliver significant cash value to our shareholders, while enabling us to accelerate the expansion of our solutions to provide customers worldwide with breakthroughs that advance our knowledge about the science of life and improve health outcomes” he added.

The stock price of Qiagen has seen further increase since the news of the acquisition broke.

References

1. http://thermofisher.mediaroom.com/2020-03-03-Thermo-Fisher-Scientific-to-Acquire-QIAGEN-N-V,1
2. https://www.thermofisher.com/us/en/home/about-us/news-gallery/press-releases/2014/thermo-fisher-scientific-completes-acquisition-of-life-technologies-corporation.html
3. https://corporate.qiagen.com/newsroom/press-releases/2019/20191030_q3_release
4. https://corporate.qiagen.com/newsroom/press-releases/2019/20191007_ceo_leadership_transition
5. https://www.nasdaq.com/market-activity/stocks/qgen
6. https://corporate.qiagen.com/newsroom/press-releases/2019/20191115_strategic_review
7. https://corporate.qiagen.com/newsroom/press-releases/2020/20200226_coronavirus

Author

Rajaneesh K. Gopinath