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Orchid Biosciences to Buy Commercial DNA Testing Provider Lifecodes for $12.7M

NEW YORK, Oct. 1 - Orchid Biosciences has said it will acquire DNA analysis company Lifecodes in a $12.6 million all-stock deal, Orchid said on Monday.  

Terms of the agreement, which have been approved by both firms’ boards of directors, call for Orchid to issue roughly 6.5 million new shares of common stock in exchange for all of Lifecodes’ outstanding equity.  

The merger is still subject to approval by Lifecodes' stockholders and is expected to close in the fourth quarter of 2001. The transaction will be structured as a tax-free share exchange, the Orchid said.  

Financial details of the deal were not disclosed. The value of the $12.7 million deal was based on Orchid's $1.95 closing price on the Nasdaq exchange on Monday. 

According to Princeton, NJ-based Orchid, the acquisition will double its 2002 revenues, which the company projects will “total well over $50 million for the combined companies” and shorten by one year Orchid's expected time to profitability.” 

"By acquiring Lifecodes, [Orchid] become the US market leader in identity genomics for forensics and paternity,” Dale R. Pfost, Orchid’s chairman, president and CEO, said in a statement. “We … plan to leverage our role as one of the largest providers of genotyping services in the world to offer expanded service and product offerings enabled by Orchid's proprietary SNP technologies.” 

The new company will have a network of eight accredited genetic testing laboratories in the US and Europe, which collectively perform more than 18 million genotypes per year, Orchid said in the statement.  

"Together, I believe that we can achieve the critical mass necessary to rationalize and progress genetic diversity markets and to leverage the ever-expanding opportunities for genetic diversity analysis in the post-genomic era," said Walter Fredericks, president and CEO of Lifecodes, who will become an advisor to Orchid following the close of the transaction.

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