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Thermo Fisher to Acquire Affymetrix for $1.3B

NEW YORK (GenomeWeb) – Thermo Fisher Scientific said after the close of the market Friday that it is acquiring Affymetrix for approximately $1.3 billion.

The firms said in a joint statement that the boards of directors of both firms have unanimously approved Thermo Fisher's offer to acquire Affymetrix for $14 per share, a 52 percent premium to Affy's closing price of $9.21 on Friday.

The deal will provide Thermo Fisher with Affymetrix's array-based platforms and chips for cytogenetics, genotyping, and gene expression research. It also is expected to strengthen Thermo Fisher's presence in applied markets, particularly the agricultural biotech market, and in certain clinical markets, such as reproductive health.

Last year, Affymetrix expanded its offerings in the ag-bio markets through its acquisition of Eureka Genomics for $15 million in cash. Eureka's low- and mid-plex genotyping assays use common next-generation sequencing platforms for signal readout, and enable the detection of hundreds to thousands of genetic markers for crop and animal agrigenomics testing, Affy said at the time of the deal.

In addition, Affymetrix's eBioscience unit will provide Thermo Fisher with a variety of tools for cellular analysis and a portfolio of antibodies, multiplex RNA, and protein and single-cell assays. Affy bought the flow cytometry firm in 2012 for $315 million, and company officials have touted the potential of eBioscience's products to push into a number of new applications, such as translational research, immunotherapy, infectious diseases, and single-cell biology.

"The acquisition of Affymetrix will strengthen our leadership in biosciences and create new market opportunities for us in genetic analysis," Marc Casper, president and CEO of Thermo Fisher, said in the statement. "In biosciences, the company's antibody portfolio will significantly expand our offering in the fast-growing flow cytometry market, and customers will have greater access to these products through our global scale and commercial reach. In genetic analysis, Affymetrix's technologies are highly complementary and present new opportunities for us in targeted clinical and applied markets. For shareholders, we expect the transaction to create value by generating attractive financial returns, including immediate accretion to our adjusted EPS."

Affymetrix had full-year 2014 revenues of $349 million, and analysts covering the firm had predicted sales of $357.6 million, on average, for FY 2015. The Santa Clara, California-based genetic analysis products firm has approximately 1,100 employees worldwide. The firm's didn't disclose whether they expect to retain all of Affy's employees following completion of the deal, expected by the end of the second quarter of 2016.

Affymetrix will be integrated into Thermo Fisher's Life Sciences Solutions Segment.

The deal is expected to add $.10 of accretion in the first full year of ownership for Thermo Fisher. It also expects to realize total synergies of approximately $70 million by year three following closing of the transaction, consisting of approximately $55 million of cost synergies and $15 million of adjusted operating income benefit from revenue-related synergies.

"Joining Thermo Fisher creates significant value for our customers, employees, and shareholders," Affymetrix President and CEO Frank Witney said in the statement. "We will be able to build on our strong history of close collaboration with customers in our target markets by leveraging Thermo Fisher's deep relationships, particularly in biopharma, as well as their global scale and leading presence in Asia-Pacific."

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