- Thermo Fisher on Thursday said it’s increasing by 10% its per-share cash offer in its deal to acquire Dutch molecular diagnostics maker Qiagen.
- Thermo Fisher originally offered a price of 39 euros per share for a total deal value of about $11.5 billion at the start of March, just before the pandemic led to widespread shutdowns across the U.S.
- Following investor pressure for Thermo Fisher to better recognize Qiagen's diagnostics opportunity amid COVID-19, it’s upping the offer by about 10% to 43 euros per share, or a 35% premium over the closing price of Qiagen shares prior the deal being announced in March. The acceptance period for shareholders is extended to Aug. 10, and Thermo Fisher still expects the acquisition to close in the first half of 2021.
Institutional investor Davidson Kempner, which said it holds a 3% stake in Qiagen, published a letter last week calling Thermo Fisher's initial offer price "inadequate" and urging the life sciences giant to amend it to reflect new value seen in Qiagen in recent months.
"The deal has become even more attractive as the impacts of COVID-19 and the broader implications have become significantly clearer since the initial announcement," the letter said.
Less than a week later, Thermo Fisher and Qiagen announced their amended agreement, which also lowers the minimum acceptance level from three-quarters of all Qiagen shares to two-thirds. Thermo Fisher will be awarded a $95 million expense reimbursement if that threshold is not met in time.
Qiagen shared preliminary second quarter results on July 9 indicating a better-than-expected 18% to 19% increase in net sales over the prior year, listing demand for RNA sample technology kits, reagents sold to third parties for use in their own kits, and cartridges for its QIAstat-Dx syndromic platform.
The company went into further detail on July 13 and said it expects third-quarter net sales growth between 16% and 21%, and full-year growth of 15% to 18%.
"Sustained elevated demand for coronavirus test products is expected to more than offset weaker year-over-year sales trends in other areas of the portfolio, which are being adversely impacted by quarantines and lockdown actions in countries around the world," Qiagen said.
Qiagen also touted a number of developments expected in late 2020 and 2021, including significant expansion of its RNA production capacity and instruments, increased manufacturing of cartridges for its QIAstat-Dx syndromic system, full acquisition of COVID-19 and flu test developer NeuMoDX, and the rollout of a serology test and rapid antigen test for COVID-19.
Thermo Fisher, which itself pre-reported a 10% jump in second quarter revenues after bracing for flat or down sales, is slated to report earnings next Wednesday, July 22. Qiagen said it anticipates sharing full second-quarter results on Aug. 4.