Qiagen North American Holdings plans to acquire eGene in a transaction worth approximately $34 million. The company reports that the decision was made because eGene’s product offering is highly synergistic with its sample and assay technologies.
"The eGene solutions leverage and seamlessly combine with Qiagen sample and assay technologies and create novel and highly attractive molecular diagnostics solutions to our customers in clinical research, applied testing, and molecular diagnostics," remarks Peer M. Schatz, CEO of Qiagen.
eGene has developed and is commercializing a patented sample-separation and analysis technology based on capillary electrophoresis. "eGene has developed a sample-separation system for nucleic acid processing that is both affordable and robust," Schatz continues. "With the eGene system, we are adding a consumable and instrument line, which provides quality control capabilities following the use of sample technologies as well as a readout system for our assay technologies in one platform.
“The combination of novel and patented multiplex fluorescence detection designs with solid-state light sources and micro-optical collectors creates an advantage over conventional gel-based sample-separation technologies,” Scatz asserts. “The eGene system permits a new dimension of ease of use and automation, freeing up the researcher's time for more important endeavors."
Under the terms of the agreement, Qiagen North American Holdings will offer $0.65 in cash and 0.0416 common shares of its stock per share of eGene stock. eGene opened trading at $1.34.
Qiagen expects that the transaction will close in the third quarter of 2007. It predicts that the acquisition will contribute approximately $2 million in sales in the second half of 2007 and roughly $7 million to $9 million in sales for the full year of 2008.
The company expects to incur one-time charges of approximately $0.01 in EPS at closing. On an adjusted basis excluding one-time charges, integration and restructuring costs, and amortization of acquired IP, the acquisition is expected to reduce EPS in the second half of 2007 by approximately $0.01 and to be neutral to earnings in 2008. Beyond 2008, revenues for this product line are expected to grow rapidly and contribute significant accretion to net income as the instrument base expands rapidly and drives increasing consumable usage, according to Qiagen.