Shares of Qiagen (NYSE:QGEN) were up 14.7% at 1:45 p.m. EST on Tuesday because the company is being acquired by Thermo Fisher Scientific (NYSE:TMO) in an all-cash deal that values Qiagen at $11.5 billion.
The news comes as a bit of a surprise since Thermo Fisher and others had been rumored to be in talks with Qiagen in November (which was eventually confirmed by management). But a month later, Qiagen management decided that none of the deals were a better option for shareholders than remaining a stand-alone company.
Healthcare investors will have to wait for documents to be filed with the Securities and Exchange Commission to get the backstory on how the deal went down, but presumably Thermo Fisher sweetened its offer to get Qiagen to come to the table.
Thermo Fisher will pay 39 euros per share for stock that trades on the Frankfurt Prime Standard, which is about $43.55 at current exchange rates, for shares that trade on the NYSE. Thermo Fisher expects the purchase to be immediately accretive to its adjusted earnings per share and thinks it can realize $200 million in synergies over the three years after the deal closes.
Through the acquisition, Thermo Fisher gets a wide array of products that are used in scientific and clinical labs for doing experiments and testing patient samples. The deal allows Thermo Fisher to expand its DNA sequencing business (Qiagen recently signed a deal with Illumina), and the company also gains access to Qiagen's new coronavirus test that began shipping last month.
With shares trading below the eventual buyout price, it appears investors have decided that another company isn't likely to outbid Thermo Fisher. The deal is expected to close in the first half of 2021.