NEW YORK (GenomeWeb News) – Hologic has entered into a definitive agreement to sell its LifeCodes business to Immucor for up to $95 million, the companies announced after the close of the market on Thursday.
LifeCodes specializes in pre-transplant human leukocyte antigen typing and screening as well as post-transplant patient monitoring. It sells molecular and antibody-based assays targeting transplant diagnostics, specialty coagulation and transfusion medicine markets.
Immucor will pay Hologic $85 million in cash, and potentially up to an additional $10 million in earn-out payments dependent on certain financial targets being achieved in 2013. The purchase is anticipated to be completed in the second quarter.
"Our sale of LifeCodes will enable Hologic to focus our resources on diagnostics opportunities that are more in line with our fundamental growth strategies," Hologic President and CEO Rob Cascella said in a statement, adding that proceeds from the transaction will go toward reducing the company's debt.
The firm said it had taken into consideration the sale of LifeCodes in its prior issued Fiscal Year 2013 financial guidance. In November, Hologic guided to non-GAAP adjusted revenues of between $2.61 billion and $2.64 billion, with non-GAAP EPS in the range of $1.56 to $1.58.
Immucor separately said that the addition of LifeCodes strengthens its position in the global in vitro diagnostics space by creating a single source for transfusion and transplantation-related testing. It added that transplantation diagnostics is about a $400 million market with mid- to high-single digit growth.
"With the LifeCodes acquisition, Immucor will be well-positioned to help both transfusion centers and HLA labs anywhere in the world improve patient safety by ensuring the most compatible transfusion and transplantation," Immucor President and CEO William Hawkins said.
Based in Norcross, Ga., Immucor manufactures and sells reagents and systems for detecting and identifying certain properties of cell and serum components of blood before transfusion.
William Quirk of Piper Jaffray estimated in a research note that LifeCodes brought in about $40 million in annual revenues.
"We view LifeCodes as a non-core asset under Hologic's product portfolio and we would not be surprised to see additional divestitures," he said, specifically noting Gen-Probe's assets around PCA3 prostate cancer testing, which is built around diagnostic rights to the PCA3 gene that Gen-Probe acquired from DiagnoCure in 2003.
In morning trading on the Nasdaq shares of Hologic were up a fraction of 1 percent to $20.76.