The story has been updated to include comments from PerkinElmer's conference call.
NEW YORK – PerkinElmer said on Monday it has agreed to acquire life science antibodies and reagents provider BioLegend for about $5.25 billion in a cash and stock deal.
The Waltham, Massachusetts-based company also reported its second quarter revenues were up 51 percent year over year.
The BioLegend acquisition is the largest in PerkinElmer's history, it said, and is expected to close by the end of 2021. San Diego-based BioLegend provides antibodies and reagents to academic and biopharmaceutical customers for use in cytometry, proteogenomics, multiplex assays, recombinant proteins, magnetic cell separation, and bioprocessing.
BioLegend has more than 700 employees, based mostly in the US, and is expected to report $380 million in revenues in 2022, PerkinElmer said. The deal will expand PerkinElmer's presence into new life sciences segments, while BioLegend's San Diego campus will become PerkinElmer's global center of excellence for research reagent content development.
"We believe joining our teams presents an incredible opportunity to accelerate discoveries that help life science researchers leverage ever-developing technologies and novel approaches to better understand and fight disease," PerkinElmer President and CEO Prahlad Singh said in a statement.
The combination of the two firms, he added on a conference call, creates a "true powerhouse that will have the skill to be able to accelerate scientific advancement and new product innovation across the company and around the world."
The deal positions PerkinElmer as a "best in class preclinical, life sciences franchise that is uniquely positioned to empower our external powers to deliver truly legendary discoveries over the coming years," Singh further said, adding the acquisition complements PerkinElmer's other recent deals in the life science space including the buys of Cisbio Bioassays, Horizon Discovery, and most recently Nexcelom Bioscience.
The company expects the deal to be accretive to its existing revenue growth and to provide $.30 of adjusted earnings per share in the first full year following the close of the deal. In the second year following its close, the deal is expected to provide $.50 of adjusted earnings per share. The combined company is expected to generate revenue synergies of $100 million annually by the fifth year following the close of the acquisition. No significant cost synergies are planned, PerkinElmer said.
PerkinElmer also reported that for the three months ended July 4, it posted revenues of $1.23 billion compared to $811.7 million in the second quarter of 2020. It beat the Wall Street estimate of $1.12 billion.
Organically, revenues were up 41 percent, PerkinElmer CFO Jamie Mock said on the conference call.
Diagnostics segment revenues rose 70 percent to $715.6 million from $420.7 million, while Discovery and Analytic Systems (DAS) segment revenues grew 31 percent to $512.8 million from $391.0 million a year ago.
Mock noted that in Q2 2021 all of the firm's businesses and end markets returned to growth compared to 2019 levels, prior to the COVID-19 pandemic.
"Our non-COVID order growth again exceeded our strong non-COVID revenue growth for the third quarter in a row, while our COVID revenue came in solidly above our previous expectations despite declining sequentially as expected," he said, adding non-COVID-19-related growth was up 40 percent year over year.
COVID-19-related products and services contributed $365 million in revenues during Q2 2021, as demand for the company's PCR testing and RNA extraction solutions did not decrease as much as the firm had anticipated, he said.
In the Diagnostics segment, the immunodiagnostics business remained strong during the recently completed quarter and grew more than 100 percent year over year. Euroimmun's non-COVID business continued to rebound "strongly," Mock said, while the reproductive health business was able to offset continued birth rate pressure and posted double-digit growth year over year.
The applied genomics business was up more than 20 percent year over year as non-COVID-19 demand doubled, Mock said.
In the DAS segment, growth was broad-based across life sciences, food, and the applied markets, he said.
The firm said that it had a profit of $245.9 million, or $2.19 per share, for the recently completed quarter compared to a profit of $137.2 million, or $1.23 per share, a year ago. Adjusted EPS for Q2 2021 was $2.83 and beat the consensus Wall Street estimate of $2.41.
Its R&D spending grew to $65.8 million, a 33 percent increase from $49.5 million a year ago, while its SG&A costs were up 28 percent to $281.8 million from $221.0. The company's restructuring costs rose to $5.1 million from $1.2 million a year ago.
PerkinElmer exited Q2 2021 with $572.8 million in cash and cash equivalents.
For Q3, 2021, the company initiated guidance with adjusted revenue anticipated to be about $1.00 billion and adjusted EPS expected to be $1.62.
For full-year 2021, PerkinElmer said adjusted revenue is expected to be $4.57 billion with adjusted EPS anticipated to be $9.88. The guidance assumes COVID-19-related revenues of $1.14 billion compared to prior guidance of $1.10 billion, Mock said, adding non-COVID-19-related growth is expected to be about 15 percent year over year, up from a previous estimate of 11 percent.
In April, the firm said GAAP revenues were anticipated to be $4.37 billion with non-GAAP EPS of $9.40.
In early afternoon trading on the Nasdaq, PerkinElmer's shares were up 3 percent at $169.40.