Thermo Fisher Scientific Sells Business
Waltham, MA 1/28/19; Tokyo, Japan 1/29/18—Thermo Fisher Scientific has announced the sale of its Anatomical Pathology business to health care firm PHC Holdings for $1.14 billion in cash. The business, which sells microscope slides, instruments and consumables, has annual revenues of $350 million. “We are pleased to have signed the agreement with Thermo Fisher Scientific. Their anatomical pathology business has shown steady growth with their strong customer base in global hospital markets, especially in the United States,” said PHC CEO Hidehito Kotani, PhD. The sale is anticipated to result in a net dilution to Thermo Fisher’s 2019 adjusted EPS of approximately $0.10. The transaction is expected to close in the second quarter.
The sale provides Thermo Fisher with cash to reduce its debt level, among other priorities. Regarding capital deployment, CEO Marc Casper stated on the company’s fourth quarter 2018 earnings call, “First, our goal is to reduce debt to strengthen our balance sheet following the Patheon acquisition. We started the year with 4x leverage, and we ended the year with just over 3x leverage after reducing debt by $2 billion.” The company ended the year with debt at $19 billion, or 3.1x on a debt-to–adjusted EBITDA basis.