Biotech Values

[DewDiligence]

BEC Is on the Block

http://online.wsj.com/article/SB10001424052748703766704576010150561277320.html

›DECEMBER 9, 2010, 10:12 P.M. ET
By ANUPREETA DAS And GINA CHON

Beckman Coulter Inc., which makes diagnostic instruments used in clinical testing, has put itself on the block and could fetch more than $5 billion in a sale, people familiar with the matter said.

Several large private-equity firms and rival companies have expressed interest in Brea, Calif.-based Beckman Coulter, which had a market value of just under $4 billion Thursday, the people said. Goldman Sachs Group Inc. is running the sale process, which began a few weeks ago, the people added. Beckman Coulter's management is currently making presentations to the potential buyers, they said.

A potential sale is still weeks away, the people familiar with the matter said. They cautioned that Beckman may call off the process if the offers come in below the company's expectations.

Beckman and Goldman declined to comment.

The company, which dates its origin to 1935—when Dr. Arnold Beckman sold the first commercial pH meter—develops, manufactures and markets products that simplify and automate biomedical testing. Its diagnostic systems are used in hospital laboratories while scientists use the firm's research tools to study biological problems, including causes of disease and potential new therapies or drugs.

The company has recently wrestled with a diagnostic-test recall that has hurt its image on Wall Street. In February, the Food and Drug Administration found that Beckman's troponin testing kits were made without obtaining appropriate product clearances. Troponin tests are used to diagnose a variety of heart disorders.

As a result, Beckman estimated that recalling the test, which brought it 2009 U.S. revenue of $60 million, would hurt the company's 2010 earnings.

In September, the company's chief executive stepped down amid these struggles.

Beckman shares jumped 16%, or $8.92, to $66.01 in after-hours trading, after ending down slightly in 4 p.m. New York Stock Exchange trading Thursday.

Beckman reported total revenue of $781.6 million for the third quarter, reflecting an increase of 4.1% from the same period a year earlier. More than half of its revenue comes from outside the U.S.‹