Danaher buying Pall for about $13.56B; Danaher to separate into 2 publicly traded companies

PORT WASHINGTON, N.Y. – Danaher will spend approximately $13.56 billion to acquire Pall Corp., a company that makes water filtration systems for airplane manufacturers, public works companies and notably, biopharmaceuticals.

Danaher also announced Wednesday that it will split into two publicly traded companies.

Pall’s life sciences segment had $1.5 billion in revenue in 2014, comprising more than half of the company’s total revenue for the year. The life sciences unit serves customers in the biopharmaceutical market, food and beverage and medical end markets.

Danaher, which produces goods for the medical and industrial sectors, will pay $127.20 for each share of Pall Corp. share, a 7 per cent premium to its Tuesday closing price of $118.62.

The companies put the deal’s value at about $13.8 billion, including debt.

There were reports earlier in the week that Thermo Fisher Scientific Inc. was also in the running to buy Pall.

Danaher anticipates the acquisition will add about 40 per cent per share to its 2016 adjusted earnings per share. The company, based in Washington, D.C., plans to finance the deal mostly with available cash and proceeds from issuing debt or new credit facilities.

The boards of both companies have approved the deal unanimously and it’s expected to close by the end of the year, if approved by Pall shareholders.

Pall, which is based in Port Washington, New York, would become a Danaher subsidiary.

Danaher will split into two companies with one focused on science and technology and the other on diversified industry. The science and technology company will keep the Danaher name. The name for the second company has not been determined.

Thomas Joyce will continue to lead Danaher as CEO. James Lico, currently executive vice-president with responsibility for Danaher’s test and measurement and Gilbarco Veeder-Root businesses, will become president and CEO of the other.

Pall’s stock gained $5.63, or 4.8 per cent, to $124.25 before the market open, while shares of Danaher rose $4.85, or 5.6 per cent, to $90.85.