PerkinElmer to sell lighting and detection business to Veritas Capital for $500 mln

Designer and manufacturer of advanced technology products for the health care industry, PerkinElmer Inc, has today agreed to sell its illumination and detection solutions (IDS) business to Veritas Capital Fund III, a New York-based private equity firm, for approximately $500 million in cash.

Massachusetts-based IDS is a global provider of custom-designed specialty lighting and sensor components, subsystems and integrated solutions to major OEMs for a number of applications within various health, environmental, and security segments.

PerkinElmer said that the business is expected to generate revenue of approximately $300 million in 2010.

The sale includes IDS' approximately 3,000 employees and 14 manufacturing facilities worldwide and the company expects the transaction to close by the end of 2010.

PerkinElmer plans to use about $470 million in net after-tax cash proceeds to reinvest in its more attractive human health and environmental health end markets.

Robert Friel, chairman and CEO of PerkinElmer said, "This transaction should reduce the company's exposure to more cyclical end markets and improve our top-line growth profile. Furthermore, we would expect adjusted gross margins to improve by over 200 basis points, contributing to higher earnings growth."

The Company also announced that its board of directors has authorised an increase in the number of shares of the company's common stock available for repurchase to 13 million.

PerkinElmer is a global leader focused on improving the health and safety of people and the environment. The company reported revenue of approximately $1.8 billion in 2009, has about 8,800 employees serving customers in more than 150 countries, and is a component of the S&P 500 Index.