|Life Technologies CEO Greg Lucier|
Thermo Fisher ($TMO) is in the process of closing its planned $13.6 billion takeover of Life Technologies ($LIFE), but a Life shareholder is suing to block the deal, saying the company is selling itself too cheap in an unfair bidding process.
The Thermo deal values Life at about $76 per share, a number the lawsuit says is far too low in light of Life's growth over the past 5 years, in which its share price has more than tripled. Furthermore, the suit alleges that Life agreed to buyout terms that unlawfully favor Thermo at the expense of shareholders.
A Thermo spokesman said the company doesn't expect the lawsuit to delay the deal's expected early 2014 close date, and Life Tech declined to comment on the issue.
|Thermo Fisher CEO Marc Casper|
Despite apparent shareholder angst, many analysts said Thermo likely overpaid for Life, pointing out that the California company lags behind rival Illumina ($ILMN) in the gene sequencing market and has reported only mid-single-digit revenue growth over the past few years.
But Thermo remains confident its multi-billion-dollar acquisition will create "an unrivaled leader in our industry," CEO Marc Casper has said, projecting an annual revenue increase of 30% and cost savings of about $275 million after the deal closes next year.
Thermo's $13.6 billion offer doesn't include the $2.2 billion it must pay to retire Life's debt, and the company reportedly beat out bids from Sigma-Aldrich and a private equity group headlined by Blackstone and Carlyle.
- read the announcement