The merged company is expected to generate an annual turnover of around $3.5bn and will be divided into four business divisions called Molecular Biology Systems, Genetic Systems, Cell Systems and Mass Spectrometry Systems.
Financing ‘going well’
Earlier this week, Invitrogen announced its financing plans were still going to plan despite the doom and gloom surrounding the global financial markets.
The $6.7bn takeover is being partly financed by a $2.65bn bank facility fully underwritten by Bank of America, UBS and Morgan Stanley.
“At this point, the financing process is going well and we are pleased with the number and quality of lenders who have subscribed to the syndication,” said David Hoffmeister, Invitrogen’s Chief Financial Officer on Tuesday.
“The investment grade ratings we received at the beginning of the process from all three major rating agencies, coupled with the significant free cash flow generated by the combined company, have made our debt offering very attractive to many investors, both national and international.”
Since then, feverish speculation about the future of Morgan Stanley has erupted with the bank’s share price plunging 57 per cent over the past four days to leave the bank valued at $20bn less than its was at the end of last week.
The news must be of concern to Invitrogen even though the ‘facility is substantially over-subscribed’ and expects the syndication to be completed within the next week.
Greg Lucier, currently CEO of Invitrogen, will become CEO of the combined company and Mark Stevenson, currently chief operating officer at ABI, will assume that same position within the new company.
“The broad capabilities of the new company will enable revolutionary scientific innovation across the spectrum of genomics, next generation sequencing, cell biology and regenerative medicine,” said Lucier.
The Molecular Biology Systems division will combine ABI’s Molecular and Cell Biology Functional Analysis division and Invitrogen’s Molecular Biology business and will house the business units of PCR Systems, Genomic Assays and Molecular Biology Reagents.
Genetic Systems will be composed of ABI’s capillary electrophoresis and SOLiD (supported oligo ligation detection) genetic sequencing platforms as well as Invitrogen’s Clinical Applications business and its third generation sequencing development program.
The Cell Systems division will be made up of Invitrogen’s Cellular Analysis, Bead-Based Separations, Cell Culture Essentials, Bioproduction, and Primary and Stem Cell Systems business units, as well as ABI’s Poros and Tropix business lines.
Perhaps unsurprisingly, the Mass Spectrometry Systems division is being left as its own division, a fact that may continue to fuel speculation about its long-term future as part of the company.
ABI’s sales of mass spectrometers from its joint venture with MDS have dipped in the last year, with MDS CEO Stephen DeFalco recently saying that the company was “assessing all possible options with a view to what is best for MDS shareholders.”