Prominent laboratory supply company Thermo Fisher(NYSE: TMO) is set to add a new asset to its portfolio: It is to acquire microscope technology specialist FEI(NASDAQ: FEIC) for $107.50 per share in an all-cash deal. That represents a premium of roughly 14% on the target’s most recent closing stock price, and will total around $4.2 billion.
In the joint press release announcing the news, Thermo Fisher CEO Marc Casper said:
In life sciences, there is growing adoption of electron microscopy to study the structure of proteins. The technologies we gain with FEI will complement our mass spectrometry leadership, putting Thermo Fisher in the best position to capitalize on this important trend.
This is not the company’s first time at the acquisition rodeo. Earlier this year, it sewed up its purchase of gene analysis specialist Affymetrix, and in 2014, it absorbed biotech company Life Technologies.
The FEI deal looks like a smart one for Thermo Fisher. Although FEI’s top line has been choppy over the years, the company is profitable, and at high net margins — last year’s revenue came in at just over $930 million, while net profit was $124 million. And since it owning it is expected to be immediately accretive to earnings (starting at around $0.30 per share in the first year) it should provide a substantial boost to its new owner’s bottom line.
The acquisition has been approved by the boards of directors of both companies, but is subject to approval from FEI shareholders, and must be cleared by the relevant regulatory authorities. The purchase is expected to close by early 2017. Once that happens, FEI will be absorbed into Thermo Fisher’s analytical instruments division.
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Eric Volkman has no position in any stocks mentioned.
Thermo Fisher Buys Microscope Tech Specialist FEI
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