Bruker Acquires Phenomex for $108 Million

On Aug. 17, 2023, U.S. metrology company Bruker Corporation and Phenomex Inc, a biotechnology company also based in the U.S., announced in a joint press release that they had agreed on a takeover deal.

Read more about the takeover of Phenomex by the biotech company Bruker, and find other important business news with the Born2Invest mobile app.

Takeover premium of a whopping 150%

Under the terms of the acquisition agreement, Bruker will offer each Phenomex shareholder $1.00 (USD) per share in cash. This offer values the biotech company at an enterprise value of approximately $108 million (approximately €100 million).

Based on the closing price of Phenomex shares on August 16th, 2023, the day before the acquisition agreement was announced, the offer includes a gigantic takeover premium of 150%. In other words, Bruker is offering Phenomex shareholders 2.5 times the previous day’s closing price!

A brief profile of the companies involved

Bruker Corporation was founded back in 1960 in Karlsruhe as Bruker Physik AG by Günther Laukien, a professor of experimental physics, and Emil Bruker. According to its own statements, the company has since developed into one of the world’s leading companies for analytical instruments.

Currently, Bruker offers high-performance systems in the fields of cell biology, preclinical imaging, clinical phenomics and proteomics research, clinical microbiology, and molecular pathology research. Or more simply explained: Bruker develops, manufactures, and distributes e.g. MRI equipment, mass spectrometers, X-ray, and superconductor technologies.

Following various acquisitions, Bruker moved its headquarters to Billerica/Massachusetts (Greater Boston) several years ago. In 2022, more than 7,500 Bruker employees worldwide generated sales of just over $2.5 billion and an operating profit (EBIT) of $462 million at more than 90 locations.

Emeryville, California (San Francisco/Oakland metropolitan area) based biotechnology company Phenomex Inc. was formed in early 2023 through the merger of Berkeley Lights and IsoPlexis.

The company develops, manufactures, and distributes cell biology analyzers, software, and molecular biology reagents. Currently, more than 400 Phenomex instruments have been installed.

The biotechnology company’s nearly 300 employees generated sales of almost $79 million in fiscal 2022. The operating profit (EBIT) was -$97 million.

This is how the stock market reacted

As was to be expected with the extremely high takeover premium, the price of Phenomex shares jumped steeply on August 17, 2023. Starting from a closing price of $0.40 on the previous day, it rose to an impressive $0.945 on the US technology exchange Nasdaq last Thursday; a gain of a good 136%!

The price was thus only just below the $1.00 offered by Bruker. Obviously, investors are assuming that the takeover will go through without a hitch. No wonder, with such a high takeover premium!

However, the price of Bruker shares dropped significantly on the same day. It fell on the Nasdaq by a good -4.5% to $62.71. Apparently, investors believe that Bruker has dug a little too deep into their pockets for the deal.

The transaction is not subject to any financing conditions and is expected to close in Q4 2023, subject to customary closing conditions. Upon closing, Phenomex will be merged into a wholly-owned subsidiary of Bruker.

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(Featured image by pasja1000 via Pixabay)

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First published in GeVestor. A third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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