Underscoring the increasingly global nature of the life science industry, Waltham, Massachusetts-based PerkinElmer announced on Monday plans to acquire Euroimmun Medical Laboratory Diagnostics AG, a Lübeck, Germany-based diagnostics company with a focus on allergies, autoimmune, and infectious diseases.
According to a company statement, the deal aims to solidify PerkinElmer’s foothold in those fields, while also helping the 9,000-employee company expand its presence in China and other emerging markets.
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By midday, PerkinElmer shares had edged up around five percent. The cash deal is expected to close in Q4 of 2017.
Euroimmun operates in more than 130 companies, with approximately 45 percent of its revenue coming from China. A further 30 percent is derived from Europe, the Middle East, and Africa. Just five percent of it sales are generated in the Americas.
According to PerkinElmer, Euroimmun is projected to generate revenues of around $310 million in 2017. Over the last five years, the company has averaged revenue growth of 19 percent.
It remains to be seen whether it can keep that momentum going as part of a larger organization. PerkinElmer Chairman and CEO Robert Friel seemed optimistic that it can, dropping the S-bomb (synergies) in his official statement.
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“With the acquisition of EUROIMMUN and its talented team of professionals, we are able to leverage our combined advanced detection, imaging and assay development capabilities, along with our strong collective market positions and synergistic commercial activities, to deliver better and more complete solutions to our customers around the world,” Friel noted.
Diagnostics represent a small fraction of PerkinElmer’s capabilities, which span analytical instruments, consumables, software, services, drug discovery, and more. It reported revenues of approximately $2.1 billion in 2016.
While modern day PerkinElmer is the product of a major merger in 1999 with EG&G, its M&A activity has flown under the radar in recent years. A number of smaller deals have been made with privately-held startups that are easily absorbed. In most cases, the terms of the deals are not released — with a handful of exceptions.
In November 2014, PerkinElmer acquired Perten Instruments for $266 million. And back in 2011, it picked up CambridgeSoft for $220 million and Caliper Life Sciences for $600 million.
Disclosure: The author of this article worked with a division of PerkinElmer at a previous job.
Photo: maxsattana, Getty Images
