GE Healthcare said today it agreed to acquire Thermo Fisher Scientific’s cell culture media and sera, gene modulation technologies, and magnetic beads businesses, all for a combined $1.06 billion.
Thermo agreed to sell the businesses in November as a condition of winning European Commission (EC) approval to acquire Life Technologies for $13.6 billion, plus assumption of $2.2 billion in the acquired company’s debt. The EC contended that keeping the businesses in Thermo's hands would have significantly reduced competition.
GE anticipates closing in the “first part” of 2014 on its acquisition, which is subject to regulatory approvals.
GE said its $4 billion-a-year Life Sciences business—which specializes in products and services for the diagnostics, research, and biopharmaceutical manufacturing sectors—will be strengthened and complemented by the Thermo businesses. The result, GE Healthcare said, will be expanded and accelerated development of “end-to-end” technologies for cell biology research, cell therapy, and drug and vaccine manufacturing.
“This deal makes a good business even better and will help us realize our vision of bringing better healthcare to more people at lower cost,” John Dineen, GE Healthcare’s president and CEO, said in a statement.
The Thermo businesses, which are primarily part of its analytical technologies segment, have combined 2013 revenues of about $250 million. That’s up from about $225 million in 2012, yet still a fraction of the $16.3 billion in combined annual revenues for Thermo and Life Tech.
While Thermo agreed to sell its HyClone™ cell culture media and sera business, it retained its single-use technologies, where the EC had not raised competitive comcerns. Thermo also consented to selling its polymer-based magnetic beads business, including the Sera-Mag™ brand and all other relevant intellectual property rights, customer contracts, personnel, and necessary production equipment.
However, Thermo also agreed to supply magnetic beads to whoever purchased the business by committing to a two-year transitional agreement.
Thermo also agreed to sell its gene modulation business, including gene silencing, which is based in Lafayette, CO. The sell-off will include the Dharmacon and Open Biosystems brands, equipment, staff, and even its license for the families of Tuschl patents governing RNA interference, and named for Alnylam founder Thomas Tuschl, Ph.D.
Dr. Tuschl is professor and head of the RNA Molecular Biology laboratory at The Rockefeller University and an investigator at Howard Hughes Medical Institute. The patent families that bear his name are based on discoveries by him and partners while he was at the Max Planck Institute for Biophysical Chemistry.
Thermo agreed to acquire Life Tech in April. The deal remains subject to additional regulatory approvals, including the approval of the U.S. Federal Trade Commission (FTC). Based on discussions with the FTC, Thermo Fisher said today it did not believe any additional divestures will be required in order to receive U.S. approval.
“The company is working with the remaining jurisdictions to obtain the approvals required to complete the acquisition as soon as possible, and continues to expect to close in early 2014,” Thermo stated.
GE Healthcare said its acquisition was consistent with its parent company’s strategy to invest in high-technology, innovative businesses that delivered strong top-line growth and expanded margins.
“By expanding our production facilities to three continents, we will be able to offer the biopharmaceutical industry greater confidence in the security of supply of cell culture media and sera, a key part of their production process,” added Kieran Murphy, president and CEO of GE Healthcare’s life sciences division.