FRANKFURT (Reuters) - Thermo Fisher Scientific (N:TMO) has launched a 10.4 billion euro ($11.6 billion/£9.1 billion ) bid for German genetic testing company Qiagen (DE:QIA), the U.S.-based company said on Tuesday.
Qiagen (N:QGEN), which makes diagnostic kits for cancer and tuberculosis, said both its management and supervisory boards would recommend the offer to its shareholders.
The company has also started shipping a new testing kit for the coronavirus to hospitals in China.
At 39 euros per share, the offer represents a 23% premium to Qiagen's closing price on Monday, Qiagen said, adding the bid assumed 1.26 billion euros in net debt. Qiagen shares rose 20.7% on the news.
Thermo Fisher, which provides scientific instruments, software and other services for scientific research and healthcare sectors, said the deal would generate $200 million in synergies by year three following the deal's close.
"This acquisition provides us with the opportunity to leverage our industry-leading capabilities and R&D expertise to accelerate innovation and address emerging healthcare needs," Thermo Fisher CEO Marc Casper said in a statement.
The Massachusetts-based company has a market valuation of around $120 billion, according to Refinitiv data.
Qiagen CEO Thierry Bernard also welcomed a deal.
"This strategic step with Thermo Fisher will enable us to enter a promising new era and will give our employees the opportunity to have an even greater impact," he said.
The German-listed company said last November that it had started to review options, including a sale, after receiving indications of interest from potential suitors. However, the following month it said it had decided its best option was to remain a standalone business.
Qiagen had been thrown into turmoil in October when its long-serving CEO Peer Schatz resigned and the company announced a reversal of its strategy, saying it would stop developing its next-generation genome sequencing machines and instead collaborate with industry leader Illumina (O:ILMN).
In February, the company beat analysts' expectations for quarterly sales and profits, citing savings generated following the decision to exit genome sequencing machines.