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Corning Buys BD's Discovery Labware Business for $730M

NEW YORK (GenomeWeb News) – Corning today announced an agreement to purchase the majority of Becton Dickinson's Discovery Labware unit for $730 million in cash.

BD's Advanced Bioprocessing platform is not included in the deal, BD said.

The deal, which is expected to be completed later this year, will increase Corning's global market access and enhance its product portfolio in drug discovery tools, bioprocess solutions, and laboratory research instruments, Corning said.

Upon completion of the deal, Corning will integrate four of Discovery Labware's main product platforms into the Life Sciences business — plastic consumable labware; liquid handling products; cell-based assays; and cell cultureware.

In a statement, Corning Chairman, President, and CEO Wendell Weeks said that the acquisition "is a critical part of Corning's long-term growth strategy." He added that Discovery Labware's $235 million in sales will expand Corning Life Sciences' annual revenues by 40 percent and accelerate that segment toward its goal of becoming a $1 billion business by 2014.

The deal, he said, "provides added momentum for Corning to achieve our $10 billion revenue target in the next few years," Weeks said.

James Flaws, Corning's vice chairman and CFO, added, "Life Sciences is an attractive growth industry and has low capital intensity. We expect this acquisition to provide a stable stream of incremental cash flow to Corning as we become a more balanced company."

William Kozy, executive vice president of BD, said in a separate statement that the transaction will allow BD Biosciences to direct resources and management attention to recent acquisitions in that segment as well as recently launched new instrument platforms.

Discovery Labware is headquartered in Billerica, Mass., and has operations in North Carolina and the UK. It has extensive dealer networks in Asia, Europe, and North America, said Corning.

Mizuho Securities analyst Peter Lawson lowered his estimates for BD today based on the acquisition. He lowered the full-year 2012 revenue estimate to $7.75 billion from an earlier estimate of $7.87 billion, and 2012 EPS to $5.51 from $5.65.

He also lowered the 2013 revenue estimate to $7.88 billion from $8.12 billion, and EPS estimate to $6 from $6.25.

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