Danaher to acquire Pall for $13.8 billion

Move represents company’s progress away from manufacturing and toward healthcare instrumentation

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WASHINGTON, D.C.—Danaher Corp. in May announced that it had entered into a definitive merger agreement with Port Washington, N.Y.-based Pall Corp. under which Danaher will acquire all of the outstanding shares of Pall for $127.20 per share in cash, or a total enterprise value of approximately $13.8 billion, including assumed debt and net of acquired cash.
Pall is a leading global provider of filtration, separation and purification solutions that remove contaminants or separate substances from a variety of solids, liquids and gases. As Danaher noted, “decades of work by Pall's filtration engineers and scientists have built a highly respected brand on which customers rely to solve their most difficult purification problems across the broad spectrum of life sciences and industry.”
In its fiscal year ended July 2014, Pall generated consolidated revenues of $2.8 billion, with $1.5 billion from its Life Sciences segment and $1.3 billion from its Industrial segment. The Life Sciences segment serves customers in the fast-growing biopharmaceutical market, as well as food and beverage and medical end-markets. The Industrial segment serves customers in the process technologies, aerospace and microelectronics markets.
“Pall is a highly attractive business, with approximately 75 percent recurring revenues, mid-single-digit organic growth and a solid margin profile. Its best-in-class technology, combined with the broadest, most technically advanced solutions, make it the premier brand in the filtration industry,” said Danaher's president and CEO, Thomas P. Joyce Jr. “Pall will provide us a leading business with significant runway for expansion and strengthens our life-sciences position in the strategically attractive, high-growth biopharmaceutical market. With the Danaher Business System as a foundation, Pall associates will have the tools to accelerate new product development and improve operational efficiency in the years to come.”
The acquisition was unanimously approved by the boards of directors of each company, and the transaction is expected to be completed around the end of this calendar year. Furthermore, by the end of 2016, the merged company will split in two. The company retaining the Danaher name will represent a combination of Pall Corp.’s and Danaher’s life-sciences, diagnostics, dental, water quality and product identification businesses. The other company, NewCo, will manufacture test and measurement products, retail fuel pumps and telematics and automation products. Both will be publicly traded entities. As Bloomberg and other media outlets and market-watchers have noted, the acquisition deal is the end portion of a steady march by Danaher away from manufacturing and toward life-sciences instrumentation markets.

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