USA – – Quidel Corporation and Ortho Clinical Diagnostics Holdings plc (jointly announced a definitive agreement in which Quidel will acquire Ortho for US$6 billion.
The merger will create a global diagnostics leader by combining two highly complementary portfolios with world-class technologies and platforms ranging from high-throughput systems to near-patient and at-home testing.
Quidel will acquire Ortho for US$24.68 per share of common stock, for a total consideration of approximately US$6.0 billion, including US$1.75 billion in cash funded by cash on the balance sheet and incremental borrowings, according to the terms of the agreement, which was unanimously approved by the Boards of Directors of both companies. The combined company will also assume Ortho’s existing US$2.0 billion net debt.
Ortho shareholders will receive US$7.14 in cash per common share and 0.1055 shares of combined company common stock for each Ortho common share, with Ortho shareholders expected to own approximately 38% of the combined company.
The transaction is expected to close in the first half of 2022, subject to shareholder approval from both companies, as well as customary closing conditions and regulatory approvals.
The acquisition will include Ortho Clinical’s COVID-19 antigen and antibody tests, as well as Quidel’s own coronavirus antigen and PCR tests.
Quidel also sells molecular diagnostics and cell culture tests, and has benefited from high demand for these tests in the last two years.
The fast-spreading Omicron variant has boosted demand for COVID-19 testing in the United States, with pharmacy chains such as Walgreens Boots Alliance and CVS Health, as well as retailer Walmart, limiting sales of at-home tests.
Quidel recently launched the test, which can detect two types of influenza and COVID-19, among others, in Europe.
Ortho Clinical also manufactures diagnostic products and equipment for in-vitro diagnostics, a nearly US$80 billion market that serves hospitals and clinics.
The deal, which is expected to close in the first half of 2022, is expected to save the companies US$90 million by the end of year three after it is completed.
Significance of the acquisition
Customers will benefit from expanded access to clinical chemistry, immunoassay, molecular diagnostics, immunohematology, donor screening, and point-of-care diagnostics offerings as the combined organization brings together world-class technologies and platforms.
Furthermore, the combined company will be able to meet patient testing needs across the care continuum, including reference labs, hospitals, physicians’ offices, urgent care centers, and at-home and retail locations.
With complementary areas of focus, the combined company will also operate on a global scale and with the speed and agility required to enhance Quidel’s current strategic approach.