Danaher to Buy GE Biopharma for $21.4 Billion
Washington, DC 2/25/19; Washington, DC 2/26/19; Boston, MA 2/25/19—Science and technology company Danaher has agreed to acquire GE’s BioPharma business in a deal valued at $21.4 billion (see Danaher to Become Major Player in Bioprocessing Market). The company will pay $20 billion in cash and finance the purchase through existing cash and debt, as well as new debt. Danaher will also assume $4 million in GE pension liabilities. Part of GE Healthcare’s Life Sciences division, the BioPharma business generated 2018 sales of $3 billion, a 7.1% increase, and $1.1 billion in EBITDA. The business supplies process chromatography solutions, cell culture media, single-use technologies, instruments and consumables for drug development, and services. “GE Biopharma is renowned for providing best-in-class bioprocessing technologies and solutions,” commented Danaher President and CEO Thomas P. Joyce, Jr. “This acquisition will bring a talented and passionate team as well as a highly innovative, industry leading product suite to our Life Sciences portfolio, providing an excellent complement to our current biologics workflow solutions.”
The purchase is anticipated to reduce Danaher’s GAAP diluted net EPS by $1.15–$1.20 and be accretive to non-GAAP adjusted diluted net EPS by $0.45–$0.50 in the first full year after closing. GE will retain the $17 million Pharmaceutical Diagnostics business of GE Life Sciences. The acquisition is expected to close in the fourth quarter.
The acquisition will boost Danaher’s position in the bioprocessing tools market, giving it a wider range of solutions for upstream and downstream workflows and a more complete range of end-to-end solutions. Currently, the company has a smaller market presence in process chromatography and cell culture media compared to other major bioprocess instrument and consumables suppliers. Danaher had previously approached GE about a possible purchase of the Life Sciences business (see IBO 4/30/18). As a result of the sale, GE will be able to pay down more of its debt, which has weighed down its balance sheet and concerned investors. The Wall Street Journal reported that GE is now reconsidering the IPO of the remainder of the Healthcare business (see IBO 6/30/18).