US laboratory equipment manufacturer Thermo Fisher Scientific is acquiring Netherlands-based Qiagen, a global provider of molecular diagnostics and sample preparation technologies. The boards of both companies approved the deal at the beginning of March.

Through the acquisition expected to be completed in the first half of 2021 following all approvals, Thermo Fisher, which is based at Waltham,  Massachusetts, said it is expanding its specialty diagnostics portfolio with attractive molecular diagnostics capabilities, including infectious disease testing, thereby complementing its capabilities with innovative sample preparation, assay and bioinformatics technologies.

At €39 per share in cash, the offer price represents a premium of roughly 23% to the closing price of Qiagen’s common stock on the Frankfurt Prime Standard exchange on Mar. 2, 2020. The deal values the Venlo-headquartered company at $11.5 billion at current US dollar-euro exchange rates and includes the assumption of approximately $1.4 billion of net debt.

Thermo Fisher will commence a tender offer to acquire all of the ordinary shares of Qiagen and expects the transaction to be immediately accretive to adjusted earnings per share after closing.

Total Synergies of $200 Million Expected

The Massachusetts company anticipates total synergies of $200 million by year three, including $150 million of cost synergies and $50 million of adjusted operating income benefit from revenue synergies. With bridge financing already committed, permanent funding is expected to come from cash on hand and the issuance of new debt.

Through the integration of the Qiagen portfolio, Marc N. Casper, chairman, president and CEO of Thermo Fisher Scientific, said his company will be in a position to leverage its industry-leading capabilities and R&D expertise to accelerate innovation and address emerging healthcare needs.

The combined enterprise will be positioned to accelerate the development of higher-specificity, faster and more comprehensive tests that may improve patient outcomes and reduce the cost of care, he said.

With 5,100 employees at 35 locations in more than 25 countries, Qiagen had sales of $1.53 billion in 2019, The Dutch group’s sample preparation technologies are used to extract, isolate and purify DNA, RNA and proteins from a wide range of biological samples, after which its assay technologies amplify and enrich the biomolecules to make them readily accessible for analysis. The company’s instruments can also automate the workflows.

As benefits for both sides, Caspar said that in life science research Qiagen’s innovative sample preparation, assay and bioinformatics technologies are complementary to his company’s genetic analysis and biosciences capabilities.

With its customer channels and comprehensive e-commerce platforms, Thermo Fisher will be able to expand customer access to Qiagen’s product portfolio, especially in emerging markets, Caspar added.

Portfolios Include Coronavirus Tests

As the novel coronavirus SARS-CoV-2 spreads across the globe, Qiagen has shipped its newly developed QIAstat-Dx Respiratory Panel 2019-nCoV test kit to four hospitals in China for evaluation. The new kit detects the virus and adds rapid Sample-to-Insight syndromic testing to the company’s portfolio of molecular testing solutions for public health emergencies.

Qiagen said it is also in the process of shipping QIAstat-Dx testing kits to public health institutions in other regions, including Europe, South-East Asia and the Middle East.

Thermo Fisher Scientific said it is offering end-to-end research solutions for the virus from pathogen detection and epidemiological studies to potential vaccine development.