PerkinElmer (PKI) Closes EUROIMMUN Acquisition For $1.3B
Zacks Investment Research | Dec 19, 2017 08:59PM ET
PerkinElmer, Inc. (NYSE:PKI) recently announced the completion of the buyout of EUROIMMUN Medical Laboratory Diagnostics AG for approximately $1.3 billion in cash. The latter is an autoimmune testing company and an emerging player in infectious disease and allergy testing.
We feel the acquisition is a strategic move by PerkinElmer. Lubeck, Germany-based EUROIMMUN has approximately 9,500 employees serving customers in more than 150 countries.
Financial Impact
The acquisition of EUROIMMUN Medical Laboratory Diagnostics should expand PerkinElmer’s reach into autoimmune and allergy diagnostic markets. The buyout will also enhance PerkinElmer’s capabilities in China’s new infectious disease market. Per management, the acquisition is expected to add about 28 cents to 30 cents per share to 2018 adjusted earnings.
Management expects the addition of EUROIMMUN to drive R&D expense margin.
The company is consistently trying to drive inorganic growth through acquisitions. The company recently completed the buyout of Tulip Diagnostics Private Limited, a company based in Goa, India, for a total consideration of $127.3 million.
Diagnostic Segment Gets a Boost
PerkinElmer will now have advanced detection capabilities, and imaging and assay development prospects to deliver better and more complete solutions to customers.
In fact, post acquisition, PerkinElmer's complete global diagnostics portfolio will get a boost. The segment now includes solutions focused on reproductive health, autoimmune, infectious disease, allergy testing, gene analyses, and genomics offerings for oncology and other molecular tests through its wide range of instruments, reagents, assay platforms and software offerings.
In this regard, the company’s Diagnostics segment grew 5% organically on a year-over-year basis to $168.9 million in the last quarter. We believe the latest development will further boost growth at the segment.
Stock Performance
The price performance of PerkinElmer has been favorable in the last year. The stock has gained 8.3%, outperforming the broader Original post
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