LabCorp Strikes Deal to Acquire Sequenom

LabCorp has entered into another big deal, coming to terms to acquire neonatal specialty lab Sequenom for $371 million.

The transaction, which will be consummated through a special firm created by LabCorp to handle the deal, includes a cash offer for $302 million and an assumption of $69 million in debt.

The San Diego-based Sequenom is best known for its MaterniT prenatal genomic test, but the company has been hit hard in recent years due to increased competition in the space. It reported revenue of $128.3 million in 2015, down more than 15 percent from the $151.6 million in 2014. Its stock had sunk from about $4.50 per share in the spring of 2015 to about 85 cents just prior to the deal being announced.

“This is exactly the kind of strategic acquisition that LabCorp seeks: Sequenom was the first laboratory to offer a clinically validated NIPT test and has performed more than 500,000 tests to date. Sequenom’s proven best-in-class technology and strong research complement LabCorp’s extensive women’s health offering, providing patients and physicians with one source for the most complete range of testing options in women’s health, including NIPT and reproductive genetics,” said LabCorp CEO Dave King in a statement. “Sequenom expands LabCorp’s geographic reach both domestically and internationally, offering services through licensing and commercial partnerships with an emphasis on the European Union and Asia Pacific. The addition of Sequenom to the LabCorp family meets our stated financial criteria, and creates a market leader in NIPT, women’s health and reproductive genetics.”

For further discussion and analyst commentary on the deal, see the September 1, 2016 issue of Laboratory Industry Report.