Massachusetts-based biotech product development company Thermo Fisher Scientific Inc. (NYSE: TMO), said it agreed to acquire North Carolina-based Patheon NV (NYSE: PTHN), a leading global provider of pharmaceutical development and manufacturing services. The deal has been approved by the boards of directors of both companies, and Thermo Fisher will commence a tender offer to acquire all of the issued and outstanding shares of Patheon for $35.00 per share in cash, representing a purchase price of approximately $7.2 billion, including the assumption of $2 billion in debt.
Thermo Fisher is the world leader in serving science, with revenues of $18 billion and more than 55,000 employees globally, through its premier brands Thermo Scientific, Applied Biosystems, Invitrogen, Fisher Scientific and Unity Lab Services.
Patheon provides comprehensive, integrated and highly customizable solutions as well as the expertise to help biopharmaceutical companies of all sizes satisfy complex development and manufacturing needs. It is a leader in the high-growth, $40 billion CDMO market, which is fueled by growing customer demand for end-to-end solutions, flexible and scalable capacity, and regulatory expertise.
Patheon has an extensive network of state-of-the-art facilities primarily in North America and Europe, and approximately 9,000 professionals worldwide. The company generated 2016 revenue of approximately $1.9 billion and will become part of Thermo Fisher’s Laboratory Products and Services segment.
“Patheon’s development and manufacturing capabilities are an excellent complement to our industry-leading offering for the biopharma market,” said Marc N. Casper, president and chief executive officer of Thermo Fisher Scientific. “Our combined capabilities will enhance our unique value proposition for these customers, create significant value for our shareholders and further accelerate our company’s growth.”
“We are confident that our combined offerings and Thermo Fisher’s proven track record of disciplined M&A and successful integrations will take our business to the next level,” said James C. Mullen, chief executive officer of Patheon.
The deal, which is expected to be completed by the end of 2017, is subject to customary closing conditions, including regulatory approvals. Thermo Fisher has entered into tender and support agreements with affiliates of JLL Partners and Royal DSM, whose collective holdings represent approximately 73% of Patheon shares.
Goldman Sachs & Co. LLC is acting as financial advisor to Thermo Fisher, and Wachtell, Lipton, Rosen & Katz is serving as legal counsel. Morgan Stanley & Co. LLC is acting as financial advisor to Patheon, and Skadden, Arps, Slate, Meagher & Flom LLP is serving as legal counsel.