Acquisition: Thermo enters CMO world

In May, the US company presented its board-approved plans to acquire Patheon NV for US$7.2bn in cash. The contract development and manufacturing organisation (CDMO) is active in a high-growth market, serving the pharma and biotech industry. Incorporated in the Netherlands, Patheon is originally a Canadian company that followed a merger and acquisition path similar to Thermo’s in the last years. Arguably, the most remarkable deal was the US$2.65bn acquisition of the pharmaceutical products business Dutch Royal DSM in 2014. Thermo will commence a tender offer to acquire all of the issued and outstanding shares of Patheon for US$35.00 per share in cash and confirmed that affiliates of JLL Partners and Royal DSM – which collectively hold an approximate 73% majority of Patheon shares – have agreed to tender their shares in the transaction.

Patheon has an extensive network of state-of-the-art facilities located primarily in North America and Europe, and approximately 9,000 employees. The company generated a 2016 revenue of US$1.9bn and will be integrated into Thermo’s Laboratory Products and Services segment which generated US$7.03bn in revenue last year. The world leader in science necessities expects the acquired CDMO services to complement their existing business. Whether with research, clinical trials, or production, Thermo said that it’s now a stronger partner for pharmaceutical and biotech customers.