Monday December 01 2008 | Biotechnology feed | All feeds
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Monday December 01 2008 | Biotechnology feed | All feeds
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Sigma-Aldrich to Acquire Proligo Group to Strengthen Genomics Research Tools Portfolio
ST. LOUIS, MO,
and Taufkirchen, Germany, 17th February 2005 -
Sigma-Aldrich Corporation (Nasdaq: SIAL) announced
today that it has signed a definitive agreement to acquire the Proligo Group (Proligo)
from Degussa AG (Frankfurt: DGXG.DE). Terms of the proposed
purchase were not disclosed.
Proligo, a global supplier of key genomics
research tools including custom DNA, custom RNA and phosphoramidite raw
materials used for DNA and RNA synthesis, had 2004 sales of approximately $40
million. Depending on the closing date for the transaction, as much as nine
months of Proligo's operating results will be added to Sigma-Aldrich's
performance in 2005, increasing overall sales growth by roughly 2%.
"The acquisition of Proligo is another key step in
our strategy to provide tools that fully meet the research needs of scientists
in the rapidly growing field of genomics," said David Harvey, Sigma-Aldrich's
Chairman and CEO. "Proligo will provide us with one of only four exclusive
licenses to a key Massachusetts Institute of Technology patent application
that covers the use of RNA in gene silencing, the new frontier in genomics
research. Adding this capability to our previously-announced partnership with
Ingex, L.L.C. to develop and market their revolutionary new gene disruption
technology (TargeTron™), our exclusive licensing arrangement with Rubicon in
whole genome amplification (GenomePlex™) and our own internal R&D activities
enhances our position in the rapidly growing functional genomics market. We
expect this investment to permit us to participate as a global leader in the
genomics and gene silencing research tools markets for years to come."
Proligo is headquartered in Boulder, Colorado, and
has manufacturing facilities in Boulder; Paris, France; Hamburg, Germany;
Helios, Singapore; Kyoto, Japan; and Lismore, Australia. The company employs
approximately 300 staff worldwide.
"This acquisition complements our existing Sigma-Genosys
business, assures a primary supply for the phosphoramidite raw materials from
which synthetic DNA and RNA are made and expands our role in helping
scientists unlock the promise of genomic research through the use of leading
edge RNA and gene silencing tools," said David Julien, President,
Sigma-Aldrich Biotechnology. "We look forward to all that Proligo and its
employees will bring to our combined success."
In announcing the proposed transaction, management
reduced its previously- announced 2005 diluted earnings per share expectations
of $3.45 to $3.55 to a new range of $3.40 to $3.50, to include dilution from
the Proligo acquisition of approximately $0.05 per share due to non-cash
impacts from purchase accounting adjustments including increases in the fair
value of acquired inventory. This revised estimated range also assumes that
currency exchange rates remain at December 31, 2004 levels throughout 2005, a
2005 effective tax rate of approximately 29%, and dilution of approximately
$0.10 per share from the previously announced and pending acquisition of JRH
Biosciences. The acquisition of Proligo is expected to be accretive to
earnings after 2005 and to make a positive contribution to cash flow in 2005
and after.
Sigma-Aldrich expects to fund the acquisition with
short term debt. Both Standard and Poor's and Moody's considered the proposed
transaction and its terms in recently reaffirming the Company's investment
grade debt ratings. The Company fully expects to remain within its targeted
debt to capital ratio of 30-35% after the acquisition.
The transaction has been approved by the boards of
directors of both companies and, subject to regulatory approval in Germany and
other customary terms and conditions, is expected to close early in the second
quarter of 2005.
Bryan Cave LLP served as legal counsel to
Sigma-Aldrich for this transaction.
Other
information:
Non-GAAP Financial Measures: The Company regularly
uses certain non-GAAP financial measures to supplement its GAAP disclosures.
The Company does not, and does not suggest investors should, consider such
non-GAAP financial measures in isolation from, or as a substitute for, GAAP
financial information. These non-GAAP measures may not be consistent with the
presentation by similar companies in the Company's industry.
With over 50% of sales denominated in currencies
other than the U.S. dollar, management uses currency adjusted growth, and
believes it is useful to investors, to judge the Company's controllable, local
currency performance. While we are able to report currency impacts after the
fact, we are unable to estimate changes that may occur during 2005 to
applicable rates of exchange and are thus unable to provide GAAP growth rates
for the year 2005 as required by Regulation G adopted by the Securities and
Exchange Commission. Any significant changes in currency exchange rates would
likely have a significant impact on our projected results and related growth
rates due to the volume of our sales denominated in foreign currencies.
About Sigma-Aldrich:
Sigma-Aldrich is a leading Life
Science and High Technology company. Our biochemical and organic
chemical products and kits are used in scientific and genomic research,
biotechnology, pharmaceutical development, the diagnosis of disease and
chemical manufacturing. We have customers in life science companies,
university and government institutions, hospitals and in industry. Over one
million scientists and technologists use our products. Sigma-Aldrich operates
in 34 countries and has over 6,000 employees providing excellent service
worldwide. We are committed to the success of our Customers, Employees and
Shareholders through leadership in Life Science, High Technology
and Service. For more information about Sigma- Aldrich, please
visit our award-winning web site at
http://www.sigma-aldrich.com
Cautionary Statement: This release contains
forward-looking statements relating to future performance, goals, strategic
actions and initiatives and similar intentions and beliefs, and other
statements regarding the Company's expectations, goals, beliefs, intentions
and the like regarding future sales, diluted earnings per share, inventory
valuation, currency exchange rates, effective tax rate and other matters.
These statements involve assumptions regarding the Company, its pending
acquisitions of and the operations of JRH Biosciences and Proligo, investments
and acquisitions and conditions in the markets the Company, JRH Biosciences
and Proligo serve. Although the Company believes its expectations are based on
reasonable assumptions, such statements are subject to risks and
uncertainties, including, among others, certain economic, political and
technological factors. Actual results could differ materially from those
stated or implied in this news release, due to, but not limited to, such
factors as (1) changes in pricing and the competitive environment, (2)
fluctuations in foreign currency exchange rates, (3) the impact of
acquisitions and success in integrating and obtaining projected results from
the acquisitions, including JRH Biosciences and Proligo, (4) other changes in
the business environment in which the Company, JRH Biosciences and Proligo
operate, (5) changes in research funding, (6) uncertainties surrounding
government healthcare reform, (7) government regulations applicable to the
business, (8) the impact of fluctuations in interest rates, (9) the
effectiveness of the Company's further implementation of its global software
systems, (10) the ability to retain customers, suppliers and employees, (11)
the success of research and development activities, (12) changes in worldwide
tax rates or tax benefits from domestic and international operations, and (13)
the outcome of the matters described in Note 11- Contingent Liabilities and
Commitments-in the Company's Form 10-Q report for the period ended September
30, 2004. The Company does not undertake any obligation to update these
forward-looking statements.
Media enquiries in Europe to Northbank
Communications:
English language enquiries to: Eileen Paul, Tel: +44 (0)1260 296505, e.paul@northbankcommunications.com German language enquiries to: Marc Egelhofer, Tel: +44 (0)1260 296505 m.egelhofer@northbankcommunications.com At Sigma-Aldrich: Kirk Richter, Treasurer Tel: 1-314-286-8004 |
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