Mass spec business consolidated

| 2 min read

A $1.1 billion deal announced today (Sept. 2) has brought an industry-leading joint venture in mass spectrometry instrumentation supply under the roof of a single manufacturing and technology company. Danaher Corporation will shell out more than $1 billion in cash for Applied Biosystems/MDS Sciex (AB SCIEX), a joint venture owned by life science tools suppliers Life Technologies and MDS Analytical Technologies. Life Technologies -- the company created by last year's merger of Invitrogen Corporation with Applied Biosystems, Inc. -- received $450 million in cash for its share of the mass spec business. Danaher paid MDS $650 million for its share of AB SCIEX, plus the former Molecular Devices Corporation, a bioresearch and analytical instrumentation company that MDS owned. "While a joint venture was once the right structure to combine corporate capabilities and launch this business, it is no longer the best approach to win in a more mature, competitive mass spec industry," said Greg Lucier, CEO of Life Technologies on a conference call with reporters today. "We believe one entity needs to control the entire value chain from R&D to manufacturing to sales and service. By purchasing both halves of the joint venture, Danaher will be able to achieve just that." "AB SCIEX is the market leader in mass spectrometry and its instruments address the needs of a broad scientific community involved in many applications including the research, applied and clinical markets," said Danaher's CEO H. Lawrence Culp, Jr., in a linkurl:statement.;http://www.danaher.com/news/news_detail.asp?key=347 "Additionally, Molecular Devices is known for high-quality, innovative products in the segments it serves. We are excited about the opportunity to acquire two leading brands in the life sciences instrumentation market, which will complement our existing Medical Technologies businesses and present an attractive value creation opportunity." Lucier told reporters that the deal will allow Life Technologies to "focus on what we do best: develop biological reagents and the associated instrument solutions that leverage our extensive understanding of DNA, RNA, proteins and cells to advance life sciences." "Mass spectrometry systems just don't have that consumable trail," Lucier added. Approximately 1800 AB SCIEX employees will be transferred to Danaher once the deal is finalized in the fourth quarter of this year, and Lucier said that the divestiture will not negatively impact Life Technologies' mass spec customers, its other business interests, or its projections for the "synergy targets" linked to last year's Applied Biosystems/Invitrogen merger. "I want to emphasize that we expect to meet all our previously announced synergy targets related to the Invitrogen/ABI transaction; both the revised amount of $95 million for 2009, and the $175 million in total synergies that we committed to when we combined the two companies last year," he said. "We see enormous opportunities in the balance of our businesses to move more aggressively into areas like genomic medicine, environmental testing, applied markets, and biofuels, just to name a few." The AB SCIEX headquarters will remain in Concord, Ontario, just north of Toronto, and will likely retain its present management staff.
**__Related stories:__***linkurl:Invitrogen-ABI merger gets EU nod;http://www.the-scientist.com/blog/display/55183/
[11th November 2008]*linkurl:Invitrogen starts AB integration;http://www.the-scientist.com/blog/display/54762/
[20th June 2008]

Mass spec business consolidated

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