Thermo Fisher Scientific To Buy FEI For About $4.2 Bln

(RTTNews) - Lab equipment maker Thermo Fisher Scientific Inc. (TMO) has agreed to acquire electron microscope maker FEI Co. (FEIC) for about $4.2 billion in cash, the two companies said Friday. Shares of FEI are gaining almost 13 percent in pre-market activity following the announcement.

Thermo Fisher noted that FEI's electron microscopy platform will complement its own mass spectrometry systems to accelerate advancements in structural biology. It will also create new opportunities to expand presence in the attractive materials science market.

Under the terms of the deal that was approved by the boards of directors of both companies, Thermo Fisher will acquire FEI for $107.50 per share in cash. The offer price represents a 13.7 percent premium to FEI's closing stock price of $94.58 on Thursday, May 26.

Hillsboro, Oregon-based FEI designs and manufactures high-performance electron microscopy workflows that provide images and information at micro-, nano- and picometer scales that are used by life sciences companies to make discoveries. The business, which had 2015 revenues of $930 million, will become part of Thermo Fisher's Analytical Instruments Segment.

Marc Casper, president and chief executive officer of Thermo Fisher Scientific said, "In life sciences, there is growing adoption of electron microscopy to study the structure of proteins. The technologies we gain with FEI will complement our mass spectrometry leadership, putting Thermo Fisher in the best position to capitalize on this important trend."

The transaction, which is expected to be completed by early 2017, is subject to the approval of FEI shareholders. Thermo Fisher intends to use proceeds from committed debt financing and cash on hand to fund the transaction.

Thermo Fisher expects the transaction to be accretive to its adjusted earnings per share by $0.30 in the first full year after close.

Further, the company expects to realize total synergies of approximately $80 million by year three following the close, consisting of about $55 million of cost synergies and about $25 million of adjusted operating income benefit from revenue-related synergies.

FEI closed Thursday's trading at $94.58. In Friday's pre-market activity, the stock is gaining $11.72 or 12.39 percent to $106.30.