OraSure to acquire DNA Genotek for $53 million

OraSure Technologies, Inc. has announced that it will be acquiring privately-held DNA Genotek Inc. for approximately $53 million in cash, subject to certain adjustments.

Kelsey Kaustinen
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BETHLEHEM, Pa.—OraSure Technologies, Inc. has announced thatit will be acquiring privately-held DNA Genotek Inc. for approximately $53million in cash, subject to certain adjustments. OraSure expects thetransaction to be neutral to non-GAAP earnings, excluding transaction costs andrequired acquisition accounting adjustments, and accretive to revenue growthfor 2011, and accretive to both non-GAAP earnings and revenue growth next year.The acquisition's closing is subject to certain customary closing conditions,and is expected to close in the third quarter of 2011. Following the close ofthe acquisition, DNA Genotek will continue operations as a wholly ownedsubsidiary of OraSure in Ottawa, Canada.
"We are delighted to have the opportunity to acquire DNAGenotek, which is a recognized leader in the nucleic acid collection market andfits soundly with OraSure's strategic goals and objectives," said Douglas A.Michels, President and CEO of OraSure, in a press release. "We targeted entryinto the $4 billion molecular diagnostics market given the magnitude and rapidgrowth profile of the segment. Our companies share a common capability andpassion to develop best-in-class oral fluid-based solutions."
The acquisition bolsters OraSure's position in the field oforal fluid diagnostics and gains the company a portfolio of products that aidin the collection, stabilization, transportation and storage of high-qualitynucleic acid (DNA and RNA) samples from saliva, such as Oragene*DNA,Oragene*RNA and OMNIgene*DISCOVER. DNA Genotek also has Performagene*LIVESTOCKfor sample collecting from livestock as well. DNA Genotek is the leadingprovider of oral fluid collection devices for the direct-to-consumer personalgenetics testing market, and its products are used in personalized medicine,clinical genetic testing, pharmacogenomics, academic research and, in the caseof Performagene*LIVESTOCK, animal genetics and livestock genetics markets. DNAGenotek's product portfolio of sample collection kits provide for reliable collectionand easy transport and processing of high-quality genetic samples without lessinvasiveness compared to blood or buccal swabs. In addition, the kits allow forsample storage at ambient temperatures for extended periods of time.
"Joining forces with OraSure at this time will beinstrumental in taking DNA Genotek to the next level," Ian Curry, President andCEO of DNA Genotek, said in a press release. "Together we will have the abilityto capitalize more quickly on the tremendous opportunity in the rapidly growingmolecular research and clinical diagnostic markets."
In a letter to DNA Genotek's customers, Curry added thatOraSure intends to keep the company's "team and structure" in place followingthe acquisition.
OraSure also specializes in the development, manufacture andmarketing of oral fluid specimen collection devices. The company's portfolioincludes infectious disease tests for the detection of antibodies for hepatitisC, antibodies for HIV and antigens for influenza types A and B, in addition tosolutions for drug-abuse testing.
"Our companies both endeavor to provide high-quality,non-invasive sample collection devices, and the combination of our resourceswill significantly enhance our ability to deliver industry leading solutions toour customers," said Curry. "The two organizations are complementary from atechnology and people perspective. We have been impressed with the leadershipat OraSure and look forward to working closely with them."
OraSure brought on Deutsche Bank Securities Inc. asfinancial advisor for the acquisition, while DNA Genotek brought on Moelis& Company as financial advisor.
SOURCE: OraSure press release

Kelsey Kaustinen

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