April 9, 2007--Agilent Technologies Inc. has signed a definitive agreement to acquire Stratagene Corp., combining two key tool suppliers to the life sciences, including the drug discovery and development sector.  Under the terms of the deal, each share of Stratagene common stock will be converted into the right to receive a cash payment of $10.94. Agilent will pay about $246.2 million to acquire the smaller company. 

Stratagene reported revenues of $95.6 million for 2006, while revenues in 2005 were $130.3 million.  The company’s net income for 2006 was $59,000 and it has approximately $32.2 million of total cash and cash equivalents as well as approximately 480 employees.  Agilent’s Life Sciences and Chemical Analysis group has about ten times that many employees and revenues of $1.42 billion. 

Stratagene makes reagents, instruments, and software for molecular biology, genomics, proteomics, and toxicology.  The company’s offerings both complement and, in some cases, overlap with those of Agilent's Life Sciences and Chemical Analysis group, which address genomics, proteomics, metabolomics, pharmaceutical analysis for drug development, QA/QC and manufacturing, and regulatory compliance.

In a press release, Nick Roelofs, vice president and general manager of Agilent’s Life Sciences Solutions Unit said, “We see Stratagene’s technology, products, and expertise as being highly complementary to Agilent’s life sciences portfolio, enabling us to offer our customers more complete workflow solutions.”  He added that, “Stratagene has a strong R&D team as well as excellent presence in the important academic and government markets.”

One of Stratagene’s target areas for growth has been diagnostics. The company already manufactures urinalysis products as well as automated instrument and reagent systems that test for more than 1,000 different allergies and autoimmune disorders from blood samples.  The company has been aiming to expand into the molecular diagnostic kit and instrumentation arena.

Stratagene and Third Wave Technologies recently reached an out-of-court settlement regarding a longstanding patent dispute.  As part of the settlement, Stratagene agreed to pay Third Wave $10.75 million in cash as full satisfaction for the judgment.  But Stratagene was also able to redeem a $21 million appeal bond.  The companies’ agreement enables either one to elect to arbitrate a patent dispute or to resolve it through a royalty-bearing license.

Copyright 2007, Cambridge Healthtech Institute. All Rights Reserved.