Brown Gibbons Lang & Company: Technology and Scale Drive M&A in Life Science Tools

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Aug 01, 2019, 11:10 ET

CHICAGO and CLEVELAND, Aug. 1, 2019 /PRNewswire/ -- Mergers and acquisitions activity in the fragmented Life Science Tools industry remains high, with consolidation expected to accelerate, according to the Healthcare & Life Sciences Insider, an industry report released by Brown Gibbons Lang & Company (BGL). Strategic M&A remains a primary lever to achieve outsized growth with participants looking to build scale and capabilities in targeted therapy areas and serve as end-to-end solutions providers.

Access the full report here.

Mergers and acquisitions activity in the fragmented Life Science Tools industry remains high, with consolidation expected to accelerate, according to the Healthcare & Life Sciences Insider, an industry report released by Brown Gibbons Lang & Company.

The BGL report, now available online, examines consolidation trends and private capital investment in the Life Science Tools sector, supported by executive insights gathered through primary research.

Key findings in the report:

Public life science tools companies are leveraging acquisitions to deliver impactful accretive revenue growth, with Danaher (GE Biopharma), Thermo Fisher (Brammer Bio), and Illumina (Pacific Biosciences) among the notable buyers to recently announce large-scale deals over the last 12 months, setting the stage for continued consolidation. "The consolidation trend is going to continue. These companies are going to have to get bigger. They need to be looking at any target that comes on the market," offered Rodney Turner, chief executive officer of AYOXXA Biosystems, a participant in the report.

Stable growth in mid-cap life science tools companies also portends the opportunity to move the needle through tuck-in acquisitions, for which there exists a robust pipeline of opportunities in a fragmented landscape. "Continued acquisition to sustain growth is important to the independence of those companies. They need to accelerate the pace of acquisitions, which means a handful of $20-$50 million (revenue size) deals a year," Turner added.

Acquirers are paying premium prices for best-in-breed technology and capability expansion to leverage across broader portfolios, with emerging growth companies attractive targets to gain this access. Robust growth in biotherapeutics, gene, and cell therapies is predicted, serving as a driver of acquisition activity. "Since 2009, the next-generation sequencing (NGS) or next-generation genomics field has accounted for as much as 75 percent of M&A transaction volume for small to mid-sized tools companies," said Turner. "As interest wanes and targets become scarcer in NGS and genomics, there will be an uptick in acquisition activity in cell and protein analysis."

About Brown Gibbons Lang & Company
Brown Gibbons Lang & Company (BGL) is a leading independent investment bank and financial advisory firm focused on the global middle market. The firm advises private and public corporations and private equity groups on mergers and acquisitions, divestitures, capital markets, financial restructurings, valuations and opinions, and other strategic matters. BGL has investment banking offices in Chicago, Cleveland, and Philadelphia, and real estate offices in Atlanta, Chicago, Cleveland, Denver, San Antonio, and San Diego. The firm is also a founding member of Global M&A Partners, enabling BGL to service clients in more than 30 countries around the world. For more information, please visit www.bglco.com.