Thermo Fisher Scientific is buying the Dutch diagnostics company Qiagen in an $11.5 billion deal that expands the Waltham-based laboratory equipment firm’s ability to detect infectious diseases, including the new coronavirus.
Qiagen said last week it had shipped a newly developed test kit to detect the virus that causes Covid-19 to four hospitals in China. The company says the kit can distinguish the novel coronavirus from 21 pathogens that cause serious respiratory disease and delivers results in about an hour. Qiagen was also shipping the kits to Europe, Southeast Asia, and the Middle East.
Marc N. Casper, chief executive officer of Thermo Fisher, said the deal announced early Tuesday will help his company broaden its business, from scientific discovery to diagnostics.
“This acquisition provides us with the opportunity to leverage our industry-leading capabilities and R&D expertise to accelerate innovation and address emerging healthcare needs," said Casper, who has been CEO since 2009.
Qiagen provides life science and molecular diagnostic equipment and employs about 5,100 people at 35 locations in more than 25 countries. The company generated 2019 revenue of $1.53 billion. Its tests are used to extract, isolate, and purify DNA, RNA, and proteins from a wide range of biological samples. The tests then enrich the substances so they can be analyzed.
Several investment analysts applauded the acquisition.
“We think the deal is a home run” for Thermo Fisher, Vijay Kumar, of Evercore in New York, wrote investors. "The assets fit well together and make strategic sense and we think there is scope for meaningful synergies over time. "
Thermo Fisher approached Qiagen in November about a potential purchase, which prompted the latter’s shares to rise 13 percent, the biggest jump in 17 years. But the deal wasn’t consummated.
“After the Christmas drama” — Qiagen had to issue a press release saying that the negotiations had halted — both companies “were finally able to hash it out and close the deal,” Kumar wrote.
The transaction values Qiagen at about $11.5 billion at current exchange rates, which includes the assumption of roughly $1.4 billion of net debt. The deal represents a premium of about 23 percent to the closing price of Qiagen’s common stock Monday on the Frankfurt Prime Standard.
Thermo Fisher is the most valuable company based in Massachusetts, with a market capitalization of more than $121 billion.
Last March, it bought Cambridge-based Brammer Bio for about $1.7 billion to move into the fast-growing area of gene therapy. Brammer Bio, a contract development and manufacturing organization, makes viral vectors that are used to deliver genetic material into defective cells in the hopes of treating or possibly even curing an inherited disorder.
Thermo Fisher has about 75,000 employees worldwide, about half of whom work in the United States. Some 2,700 work in Massachusetts. Last December, the company formally opened a $93 million gene therapy manufacturing plant in Lexington at a ceremony where Governor Charlie Baker spoke. About 200 people are expected to work at the plant.
Thermo Fisher’s share price closed up about 2 percent at $310.36 Tuesday.
Jonathan Saltzman can be reached at firstname.lastname@example.org