The company said that the acquisition expands its bioproduction capabilities and adds an important services component in a transaction that will be accretive to 2004 earnings per share. Invitrogen is building a business based on molecular biology for the discovery of biologic drugs, as well as their development and production.
Under the terms of the deal, Invitrogen will acquire BioReliance in a transaction valued at approximately $500 million (€396m), including the assumption of around $70 million in debt, in the form of a cash tender offer of $48 per BioReliance share.
BioReliance is a contract service organization providing testing, development and manufacturing operations for biologic-based drugs to biotechnology and pharmaceutical companies worldwide. The transaction has been approved by the boards of directors of both companies and is expected to close, subject to regulatory and other approvals, near the end of the first quarter of 2004. Invitrogen expects the transaction to be accretive to its pro forma EPS by about $0.19 in 2004.
"BioReliance helps us expand our already strong position in the bioproduction space and enables new opportunities with our large biotech and pharmaceutical customers," said Gregory Lucier, Invitrogen's chief executive.
Invitrogen's activities in the bioproduction area include its Gibco brand cell culture media, sera, reagents, customised packaging and cell lines, as well as testing and technical and regulatory support.
The BioReliance deal rounds off an acquisitive year for Invitrogen, which in fiscal 2003 included: PanVera (bringing in protein production, purification and characterisation capabilities as well as biochemical and cell-based assays; labelling and detection specialists Molecular Probes and Genicon Sciences; and Sequitur, which provides a range of drug discovery tools.
These deals already amount to an outlay of $440 million-plus, noted Lucier in a conference call to discuss the BioReliance acquisition. However, Invitrogen has been sitting on something of a cash pile, ending fiscal 2003 with over $1 billion in funds available for investments.
BioReliance reported third-quarter earnings of $4.6 million on revenue of $24.3 million. Invitrogen had a profit of $13.7 million on revenue of $196.9 million for the equivalent period and expects to generate revenue of $890 million in 2004.