Thermo Fisher Scientific and Patheon announced that their boards of directors have approved Thermo Fisher's acquisition of Patheon.
Waltham/USA — The next step will be a tender offer to acquire all of the issued and outstanding shares of Patheon for $ 35.00 per share in cash. The transaction represents a purchase price of approximately $ 7.2 billion, which includes the assumption of approximately $ 2.0 billion of net debt.
Patheon has a network of facilities primarily in North America and Europe, and approximately 9,000 professionals worldwide. The company generated 2016 revenue of approximately $ 1.9 billion and will become part of Thermo Fisher's Laboratory Products and Services Segment. By acquiring the company, Thermo Fisher intends to ensure access to the attractive CDMO Market, which it figures at $ 40 billion.
The company estimates Patheon's market to be in the mid-single to high-single digits and expects considerable synergies from the combined services and research efforts. Thermo Fisher expects to realize total synergies of approximately $ 120 million by year three following the close, consisting of approximately $ 90 million of cost synergies and approximately $ 30 million of adjusted operating income benefit from revenue-related synergies.
The transaction, which is expected to be completed by the end of 2017, is subject to the satisfaction of customary closing conditions, including the receipt of applicable regulatory approvals, the adoption of certain resolutions relating to the transaction at an Extraordinary General Meeting of Patheon's shareholders, and completion of the tender offer. Thermo Fisher has entered into tender and support agreements with affiliates of JLL Partners and Royal DSM, whose collective holdings represent approximately 73 % of Patheon shares, under which they will tender their shares in the transaction.
Thermo Fisher has obtained committed debt financing from Goldman Sachs Bank USA and Goldman Sachs Lending Partners LLC. The company expects to finance the purchase price with debt of approximately $ 5.2 billion and equity of approximately $ 2 billion. The offer is not subject to any financing condition.