Thermo Fisher to buy Dutch drug ingredients maker Patheon for $5.2 bn
16 May 2017
The world's largest maker of scientific instruments, Thermo Fisher Scientific Inc, today struck a deal to buy Dutch drug ingredients maker Patheon NV, for $5.2 billion.
Under the terms of the deal, Thermo Fisher, created in 2006 through the merger of Thermo Electron and Fisher Scientific, has offered to pay $35 per share, a premium of about 35 per cent to Patheon's Friday close.
The deal, including debt, is around about $7.2 billion, both companies said in a statement.
Thermo Fisher said that it has committed debt financing from Goldman Sachs and expects to finance the deal with about $5.2 billion of debt and $2 billion of equity.
Private equity firm JLL Partners and Dutch vitamin maker Royal DSM NV, who hold combined 73 per cent of Patheon shares, have agreed to tender their shares to the transaction.
Post closing, Patheon will become part of Thermo Fisher's Laboratory Products and Services Segment.
The proposed acquisition comes a year after Thermo Fisher purchased California-based Affymetrix Inc for $1.3 billion, and signature electron microscopy technology maker FEI Co for about $4.2 billion.
Excluding Patheon, Thermo Fisher has made acquisitions worth $22 billion over the past five years, according to data compiled by Bloomberg.
Formed in 2014 through the merger of Canadian drugmaker Patheon Inc and the pharmaceutical business of Royal DSM, Patheon is a global provider of high-quality drug development and delivery solutions to the pharmaceutical and biopharma sectors.
Patheon, which is a leader in the high-growth, $40-billion contract development and manufacturing organisation (CDMO) market, has a network of state-of-the-art facilities primarily in North America and Europe.
It employs around 9,000 people and has annual revenue of $1.9 billion.
"Patheon's development and manufacturing capabilities are an excellent complement to our industry-leading offering for the biopharma market," said Marc Casper, president and CEO of Thermo Fisher Scientific.
James Mullen, CEO of Patheon, said, "Over the past several years, we have increased our capabilities to become a leading CDMO provider in a highly fragmented market. We are confident that our combined offerings and Thermo Fisher's proven track record of disciplined M&A and successful integrations will take our business to the next level."
Waltham, Massachusetts-based Thermo Fisher specialises in the field of scientific machinery for health-care services, as well as providing chemical supplies and medical services for hospitals and scientific research.
It has revenues of $18 billion and employs around 55,000 people in 50 countries.