Beckman Coulter board approves sale to Danaher
Medical tool and chemical maker Beckman Coulter Inc., based in Brea, would be sold to a Washington, D.C., company for $6.8 billion under a deal being offered to stockholders.
Beckman, which manufactures laboratory equipment for biotechnology research, would be purchased by Danaher Corp. and become part of its life sciences and diagnostics business.
Beckman has been entertaining offers since late last year. The proposed sale to Danaher is the culmination of developments that began when the Food and Drug Administration said Beckman made unapproved changes to a heart disease test that resulted in faulty readings.
In March, the company issued a recall of the test, which forced it to revise its profit forecast and caused the stock price to plummet. Then in September, Scott Garrett, Beckman’s chief executive for more than five years, resigned.
J. Robert Hurley, senior vice president of human resources, was named interim president and CEO.
On Monday, Beckman announced that the deal was endorsed by its board. “Following a very comprehensive and competitive process, the board of directors voted unanimously to accept Danaher’s proposal,” Hurley said in a statement. “We believe this transaction maximizes Beckman Coulter shareholder value while strengthening the company’s position as a leader in biomedical testing.”
Beckman has yet to release its 2010 year-end financial numbers. It had $3.3 billion in revenue in 2009.
“We believe this will be a high-fit, high-opportunity deal,” Danaher CEO Lawrence Culp said in a conference call with analysts. He added that Danaher was looking to “unlock value at Beckman.”
Danaher is offering to purchase all Beckman’s outstanding shares of common stock within the next seven business days at a purchase price of $83.50 a share, amounting to $6.8 billion. The deal is expected to be completed in the first half of the year.
Closing depends on a majority of Beckman’s shareholders tendering their shares in favor of the deal. Beckman’s board unanimously supports the sale.
The offer was 11% higher than Beckman’s closing price Friday. It is about 45% higher than the closing price Dec. 9, the date when it was revealed that the company was up for sale.
Jeffrey Loo, an analyst with Standard & Poor’s Equity Group, said he expected shareholders to go along with the deal. He was also confident that Beckman’s workforce of 2,000 people in Southern California is unlikely to see layoffs as a result of the sale.
“Danaher is looking to expand its healthcare-related business,” Loo said. “Beckman is a reputable name within that field.”
Beckman bears the name of Arnold O. Beckman, a scientific visionary who earned 14 patents over his long career. One of his first inventions, the pH meter, which measured the sourness in lemons, earned him a place in the National Inventors Hall of Fame in Akron, Ohio.
Beckman Instruments Inc., as it was once known, became a fixture of Orange County’s medical technology industry. It changed its name to Beckman Coulter in 1998 after acquiring Coulter Corp., a manufacturer of systems for analyzing blood and other cells.
The company has facilities locally in Carlsbad, Chino and Brea. But it has a global reach with an additional 10,000 employees elsewhere in the U.S. and in countries including Ireland, Germany and Japan.
“Even though the deal appears to be done, I don’t expect the Beckman name to go away any time soon,” Loo said. “It’s a reputable name that goes back decades and a name that everyone in this industry is familiar with.”
Beckman shares rose almost 10% to $82.65 on Monday — slightly less than Danaher’s offer. Danaher shares were up more than 2% to $49.03.
