Sector News

After Catalent rumors, Danaher strikes $5.7B deal to acquire antibody specialist Abcam

September 2, 2023
Life sciences

It’s a sale. Two months after Abcam launched a strategic review of the company, the British antibody research expert has revealed that it’s being bought by Danaher.

Danaher Corporation is picking up all outstanding shares of Abcam for $24 apiece. Both companies’ boards unanimously approved the decision, Danaher and Abcam said Monday. The deal, which is worth about $5.7 billion, is expected to close in mid-2024.

That sum is “reasonable” for a company like Abcam, analysts at J.P. Morgan wrote in a note to clients Monday. The team added it expects almost no “regulatory pushback” given the lack of product overlap between companies.

Overall, the bolt-on deal “nudges” Danaher toward attractive, high-margin and recurring consumables revenue, the J.P. Morgan team said.

“We note there is still ample firepower for additional deals,” the analysts added.

Based in Cambridge, U.K., Abcam markets antibodies, reagents, biomarkers and assays for drug discovery, research and diagnostics. The company says it boasts some 750,000 customers across its businesses.

The move comes two months after Abcam’s board unanimously decided to explore strategic options, including a potential sale. Back in June, Abcam said it was perusing a “broad range of options to maximize shareholder value.” At the same time, the company noted it had already received several “strategic inquiries” from multiple parties in the preceding weeks.

Monday, Abcam said it engaged with 30 other potential counterparties including “more than 20 potential strategic acquirers” before it struck its deal with Danaher.

Danaher, for its part, expects to fund the purchase using cash on hand plus proceeds from the release of a commercial paper.

The deal comes after Danaher reportedly weighed a potential buyout of contract manufacturer Catalent.

Back in February, Bloomberg first reported that the life sciences conglomerate was looking to buy the CDMO at a “significant premium.” By April, though, Danaher had reportedly ditched that plan.

It’s not entirely clear why Danaher changed its mind, but Bloomberg’s report came shortly after Catalent revealed productivity problems and high costs at three of its facilities. The company’s chief financial officer, Thomas Castellano, had also stepped down.

While that possible deal never came into fruition, it wouldn’t have been the first time Danaher floated some serious cash for a contract manufacturer. Back in 2021, the company laid out $9.6 billion to acquire market leader Aldevron.

Aldevron, founded in 1998, is a global player in production of plasmid DNA, mRNA and recombinant proteins used in vaccines, gene and cell therapies and more.

Editor’s note: This story has been updated with additional commentary by J.P. Morgan.

By Fraiser Kansteiner


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