NEW YORK (GenomeWeb News) – PerkinElmer said after the close of the market Tuesday that it has reached an agreement to sell its Illumination and Detection Solutions business to private equity group Veritas Capital Fund III for around $500 million in cash.
PerkinElmer said that the divestiture would enable it to reinvest in its core Human Health and Environmental Health businesses.
IDS is expected to bring in revenues of roughly $300 million for 2010. Its financial results will be reported as discontinued operations going forward. The unit employs around 3,000 people and makes specialty lighting and sensor components that are used in a variety of applications in the health, environmental, and security fields.
"The divestiture of our IDS business reduces the complexity of the company and frees up capital to reinvest in our more attractive Human Health and Environmental Health end markets," Robert Friel, chairman and CEO of PerkinElmer, said in a statement. "In addition, this transaction should reduce the company's exposure to more cyclical end markets and improve our top-line growth profile."
As a result of the divestiture, PerkinElmer has updated its 2010 financial guidance. The firm said that it now expects to report organic revenue growth in the high single digits and GAAP earnings per share of between $1.06 and $1.11. On an adjusted basis, its EPS is expected to be between $1.24 and $1.29, down from the forecast it provided in early August of between $1.49 and $1.54.
For full-year 2009, PerkinElmer had reported total revenues of $1.8 billion — with its Human Health segment bringing in revenues of $736.5 million and its Environmental Health segment generating sales of $1.08 billion. Its EPS for 2009 was $.73.
PerkinElmer also said that its board of directors had authorized an increase in the number of shares of the company's common stock available for repurchase to 13 million. It said that purchases would be made on the open market or through privately negotiated transactions.