Life Tech shareholder sues over $13.6B Thermo buyout

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

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