Affymetrix, Inc. (NASDAQ: AFFX)
On Friday, after the market closed Thermo Fischer Scientific (TMO) announced an agreement to acquire Affymetrix for $14 per share in an all cash deal. The stock was halted at $9.21 just prior to the announcement and shot up to $13.82 in after-market trading once the halt was lifted. The stock traded between $13.72 to $13.90 in Monday pre-market action.
Affymetrix CEO Comments
In a prepared statement, Frank Witney, president and chief executive officer of Affymetrix, said, “Joining Thermo Fisher creates significant value for our customers, employees and shareholders. We will be able to build on our strong history of close collaboration with customers in our target markets by leveraging Thermo Fisher’s deep relationships, particularly in biopharma, as well as their global scale and leading presence in Asia-Pacific. We are excited about the opportunity to combine our portfolios and strengthen our position in high-growth markets such as single-cell biology, reproductive health and AgBio. Our employees will benefit by being part of an industry-leading company, which brings many opportunities for career growth and development. We look forward to working closely with the Thermo Fisher team to ensure a smooth transition and integration.” Business Wire
Thermo Fischer CEO Comments
“The acquisition of Affymetrix will strengthen our leadership in biosciences and create new market opportunities for us in genetic analysis,” said Marc N. Casper, president and chief executive officer of Thermo Fisher Scientific. “In biosciences, the company’s antibody portfolio will significantly expand our offering in the fast-growing flow cytometry market, and customers will have greater access to these products through our global scale and commercial reach. In genetic analysis, Affymetrix’s technologies are highly complementary and present new opportunities for us in targeted clinical and applied markets. For shareholders, we expect the transaction to create value by generating attractive financial returns, including immediate accretion to our adjusted EPS.” Yahoo Finance
AFFX Analysis
The agreed upon price of $14 per share represents a 52% increase over last Friday’s closing price of $9.21. However it equates to only a 6.8% increase over AFFX’s 52-week high of $13.11 reached in March 2103.
At this stage of a merger, there are three possibilities. First the deal could close at the announced price and therefore remain near $14. Next, one or more third parties could get involved with competing bids to acquire AFFX, putting the stock in-play for days, weeks or months. And finally activist shareholders could try to challenge the deal on valuation and make a case for a higher buyout price, or for the company to remain independent. Affymetrix stock is now purely catalyst driven and historic technical indicators are not helpful. I will pay attention to news feeds to see if third parties or shareholders take action.
Affymetrix Company Profile
Affymetrix, Inc. is a provider of life science products and molecular diagnostic products that enable parallel analysis of biological systems at the gene, protein and cell level. The Company sells its products to genomic research centers, academic institutions, government and private laboratories, as well as pharmaceutical, diagnostic and biotechnology companies. The Company maintains sales and distribution operations across the United States, Europe, Latin America and Asia. It operates in two business segments: Affymetrix Core and eBioscience. Affymetrix Core focuses on the development, manufacture and commercialization of systems for genetic analysis in the life sciences, agricultural biotechnology (AgBio) and diagnostic industries. eBioscience primarily focuses on the development, manufacture, marketing and distribution of research products in the areas of flow cytometry, immunoassays, microscopic imaging and other protein-based analyses. Google Finance
