Friday, March 20, 2009

Inverness puts up $200M for Acon unit

By Marc Songini

Waltham-based Inverness Medical Innovations Inc. is buying out the diagnostics business of Acon Laboratories Inc. for some $200 million.

Inverness (NYSE: IMA), which makes diagnostic tests, announced it had made a definitive agreement with San Diego-based Acon to acquire its global research, development, manufacturing, marketing and sales business for its lateral flow immunoassay diagnostic test kits. These service the consumer, point-of-care and laboratory markets.

This is part of a long-term strategy. In March 2006, Inverness acquired Acon’s rapid diagnostics business for the United States, Canada and Europe. As part of the deal, the companies agreed that if “certain financial performance and operating conditions” were met, Inverness would acquire Acon’s rapid diagnostics business to sell to China, Asia Pacific, Latin America, South America and other regions, as well.

The acquisition is expected to close on April 30, with customary closing conditions. The final aggregate price of $200 million is subject to Acon’s financial results for calendar year 2008 -- along with working capital and other customary adjustments. Inverness expects to self-finance the transaction with cash on hand and ongoing cash flows. It can pay up to approximately 34 percent of the purchase price in shares of Inverness common stock. The payments will be staggered, with the first to occur at the deal’s closing and the last to occur in October 2011.

Acon is retaining its other global in-vitro diagnostics businesses, including diabetes, clinical chemistry and immunoassay products.