Thermo Fischer to sell cell research business to GE for over $1 bn

The world's second-largest laboratory equipment and supplies provider Thermo Fischer Scientific Inc has agreed to sell its cell research business to GE Healthcare, a unit of multinational industrial conglomerate General Electric Co, for $1.06 billion, fulfilling the European Commission's (EC's) requirement to complete its pending acquisition of rival Life Technologies Corp.

Earlier in April, Thermo Fischer agreed to acquire California-based Life Technologies which produces special products used to study DNA, for around $12.8 billion. (See: Thermo Fisher nears $12.8-bn takeover of Life Technologies: report)

In November, the EC cleared the deal between both the US-based companie,s which was conditional on divestments of businesses producing and supplying media and sera for cell culture, gene silencing products and polymer-based magnetic beads, as the activities of both the companies overlap in life science markets.

"The remedies preserve competition and innovation in the life sciences industry. The EC vice president in charge of competition policy Joaquín Almunia stated.

The deal includes the sale of Thermo Fischer's cell culture, gene modulation, and magnetic beads businesses which are part of the company's analytical technologies segment.

Estimated revenue of the three divisions in 2013 is approximately $250 million.

The transaction is expected to close in early 2014 subject to required regulatory approvals including the US Federal Trade Commission (FTC). Thermo Fischer believes that any additional divestures would not be required to receive the US approval.

For GE, the acquisition will allow it to expand its growing life sciences business by offering technologies for the discovery and manufacturing of innovative new medicines, vaccines and diagnostics, it said in a statement.

Further to the completion of the transaction, the acquired business will become part of GE Healthcare's life sciences division.

GE Healthcare president and CEO John Dineen said, ''Combining GE's engineering expertise with our capabilities in life sciences is already bringing great benefits to industry, research and patients.

''This deal makes a good business even better and will help us realise our vision of bringing better healthcare to more people at lower cost.''

Cell culture is significant in the manufacture of drugs for the treatment of diseases such as cancer and arthritis and also a new generation of vaccines. Thermo Fischer's HyClone culture media and sera products are highly complementary to GE Healthcare's cell biology research and bio pharmaceutical manufacturing, GE said.

Thermo Fischer's gene modulation will help GE for drug discovery research, while its Mag magnetic beads product line will extend GE's protein analysis and medical diagnostics.

GE Healthcare's Life Sciences division president and CEO Kieran Murphy commented, ''In addition to providing us with new approaches to drug discovery and biomedical research, this acquisition is a significant step forward for our customers in biopharmaceutical manufacturing.''

''They will benefit immediately from an expanded range of ''start-to-finish'' technologies that will help them improve product yields and reduce time-to-market, he added.

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. The company has around 39,000 employees and its annual turnover is around $13 billion.

Buckinghamshire, UK-headquartered GE Healthcare is a division of GE Technology Infrastructure, which is itself a division of General Electric.

The company is engaged diverse healthcare businesses including medical imaging, software & IT, patient monitoring and diagnostics to drug discovery, biopharmaceutical manufacturing technologies and performance improvement solutions, employing more than 46,000 people worldwide.