"This deal appears to make sense as Dako isconsidered an attractive asset in tissue diagnostics, a market with robustunderlying fundamentals," wrote Doug Schenkel, an analyst at
Cowen & Co.,shortly after the announcement of the deal, adding that Agilent has some $3.9billion in cash outside the United States and that money could be used for morelife-science and diagnostic deals in other countries to avoid U.S. taxes.
The acquisition is expected to close within thenext 60 days, subject to the satisfaction of customary closing conditions, andAgilent expects the acquisition to be immediately accretive to corporateearnings on a non-GAAP basis.
Dako provides antibodies, reagents, scientificinstruments and software primarily to customers in pathology laboratories "toraise the standards for fast and accurate diagnostic answers for cancerpatients," according to the companies. Dako also collaborates with a number ofmajor pharmaceutical companies to develop new potential pharmacodiagnostics, orcompanion diagnostics, which may be used to identify patients most likely tobenefit from a specific targeted therapy. Dako's products are sold in more than100 countries employing more than 1,000 people, and in 2010 its annual revenuewas approximately $340 million.
Looking forward, Agilent said in a conference callabout the acquisition that it expects Dako to generate sales $373 million infiscal year 2013 and noted that it will probably report Dako sales as aseparate segment. If Agilent's predictions of immediate gains from theacquisition hold true, it could be a good boost for the company, given that thelife-science part of Agilent was responsible for roughly one-third of thecompany's 2011 revenue of $5.58 billion.
