Abcam acquired by Danaher: fairness opinion by Morgan Stanley and Lazard
Deal terms
Implied value per share by method vs. $24.00 offer
Ranges as disclosed in the banker’s summary of analyses; the red line marks the per-share consideration.
Opinion of Morgan Stanley to the target board
Discounted cash flow assumptions
Unlevered free cash flows for CY2023-2034; terminal value via perpetual growth applied to UFCF after 2034; values discounted to reflect premium versus unaffected share price as of 16 May 2023.
Selected public companies (8)
Sartorius AG · Waters Corporation · Bio-Techne Corporation · Maravai LifeSciences Holdings, Inc. · Repligen Corporation · Qiagen N.V. · Revvity, Inc. · Agilent Technologies, Inc.
| Multiple | Peer low | Peer median | Peer high | Range applied | Implied per share |
|---|---|---|---|---|---|
| AV / Estimated 2023 EBITDA | — | — | — | 17.3x–25.5x | $13.85–$20.65 |
| AV / Estimated 2024 EBITDA | — | — | — | 16.2x–20.6x | $17.70–$22.65 |
Selected precedent transactions (13)
| Date | Target | Acquirer | Multiple |
|---|---|---|---|
| 2022-08 | Albumedix Ltd. | Sartorius AG | — |
| 2021-12 | PeproTech, Inc. | Thermo Fisher Scientific, Inc. | — |
| 2021-08 | BioVision, Inc. | Abcam | — |
| 2021-07 | BioLegend Inc. | PerkinElmer, Inc. | — |
| 2021-01 | Oxford Immunotec USA, Inc. | PerkinElmer, Inc. | — |
| 2021-06 | Aldevron LLC | Danaher | — |
| 2021-06 | BBI Group | Novo Holdings A/S | — |
| 2021-05 | Nexcelom Bioscience | PerkinElmer, Inc. | — |
| 2021-04 | PPD, Inc. | Thermo Fisher Scientific, Inc. | — |
| 2020-11 | Horizon Discovery Group plc | PerkinElmer, Inc. | — |
| 2019-11 | LGC Group | Cinven Limited/Astorg Advisory LLC | — |
| 2019-07 | BioTek Instruments | Agilent Technologies, Inc. | — |
| 2018-03 | Integrated DNA Technologies, Inc. | Danaher | — |
| Multiple | Low | Median | High | Range applied | Implied per share |
|---|---|---|---|---|---|
| AV / LTM EBITDA (applied to Abcam LTM EBITDA as of 30 September 2023) | — | — | — | 20.0x–30.4x | $14.70–$22.60 |
Other analyses
| Analysis | Summary | Implied per share |
|---|---|---|
| Historical Trading Range (52-week period preceding 16 May 2023) | For reference only; closing trading price of Abcam ADSs ranged from $12.60 to $17.90. | $12.60–$17.90 |
| Equity Research Analysts' Price Targets | For reference only; price targets from six equity research analysts as of 23 August 2023, excluding SVB Financial Group's $40.00 outlier; undiscounted range $17.00-$25.00. | $17.00–$25.00 |
| Illustrative Future Share Price Analysis | For reference only; future share price as of December 2025 using a range of EV/NTM EBITDA multiples applied to estimated 2026 Adjusted EBITDA from the Management Projections, discounted at a 10% cost of equity. | $22.10–$28.30 |
| Illustrative Leveraged Buyout Analysis | For reference only; assumed required IRR of 20.0%-25.0%, 6.0x gross leverage at SOFR + 6%, exit multiple of 17.5x-22.5x LTM EBITDA after a five-year holding period. | $15.05–$21.70 |
| Premia Paid Analysis | For reference only; premia in seven life sciences tools and diagnostics M&A transactions prior to 14 April 2021 with announced value of $1bn+; applied 25th and 75th percentile premia of approx. 20% and 36% to the unaffected share price of $17.23 as of 16 May 2023. | $20.70–$23.45 |
Engagement letter dated 20 July 2023; fee for financial advisory services all contingent upon closing of the Transaction. Morgan Stanley will also receive an advisory fee for past services rendered in connection with the previously proposed shareholder-vote solicitation, payable upon closing. Morgan Stanley has provided financial advisory and financing services to Danaher in the prior two years and received fees.
Opinion of Lazard to the target board
Management projections
| Projection year | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 | CAGR |
|---|---|---|---|---|---|---|
| Revenue | $600M | $686M | $784M | $893M | $1.0B | 13.9% |
| Revenue growth | 16.3% | 14.3% | 14.3% | 13.9% | 13.0% | |
| EBITDA | $266M | $321M | $387M | $451M | $521M | 18.3% |
| EBITDA growth | 35.7% | 20.7% | 20.6% | 16.5% | 15.5% | |
| EBITDA margin | 44% | 47% | 49% | 51% | 52% | |
| Implied EV / EBITDA | 21.4x | 17.8x | 14.7x | 12.6x | 10.9x |
Year-1 growth is against LTM at announcement ($516M revenue, $196M EBITDA); later years are year over year.
Abcam management prepared the "Management Projections" based on the Long Range Plan approved by the Abcam Board on 11 July 2023, covering calendar years 2023 through 2034 (Long Range Plan for 2022A-2030E, management extrapolation for 2031E-2034E), provided in GBP and converted at 1 GBP:1.20 USD. Revenue grows from £430m ($516m) in 2023E to £1,360m ($1,633m) in 2034E, with Adjusted EBITDA rising from £163m ($196m) to £731m ($877m) and Adjusted EBIT from £124m ($149m) to £662m ($794m). Unlevered free cash flow (derived from the projections and approved for use by Morgan Stanley and Lazard) grows from $103m in 2023E to $574m in 2034E; these were the only projections used by both advisers.
Process notes
Other Diagnostics / Life Sciences fairness opinions
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- Chembio Diagnostics / Biosynex SA 2023
- Meridian Bioscience / SD Biosensor / SJL Partners 2022 · 17.6x EV/EBITDA
- Exact Sciences / Abbott 2025 · 44.2x EV/EBITDA
- Enzo Biochem / Battery Ventures 2025
- Akoya Biosciences / Quanterix 2025
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