Quest's $1.3 Bil. SmithKline Lab Buy Provides 10% Market Share - S&P
This article was originally published in The Gray Sheet
Executive Summary
Quest Diagnostics' credit rating with Standard & Poor may be downgraded over financing and integration concerns associated with the company's planned $1.3 bil. acquisition of SmithKline Beecham's Clinical Laboratories division.
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Quest
Teterboro, New Jersey-based diagnostics manufacturer receives $95 mil. cash settlement for outstanding items in connection with the February 1999 acquisition of SmithKline Beecham Clinical Laboratories for $1.3 bil. (1"The Gray Sheet" Feb. 15, 1999, p. 27). The pact contained a provision for a cut in the purchase price "in the event that a review of the SBCL financial statements showed that the net assets acquired, as of the acquisition date, were below a prescribed level," Quest explains in release
Quest
Teterboro, New Jersey-based diagnostics manufacturer receives $95 mil. cash settlement for outstanding items in connection with the February 1999 acquisition of SmithKline Beecham Clinical Laboratories for $1.3 bil. (1"The Gray Sheet" Feb. 15, 1999, p. 27). The pact contained a provision for a cut in the purchase price "in the event that a review of the SBCL financial statements showed that the net assets acquired, as of the acquisition date, were below a prescribed level," Quest explains in release
Quest Diagnostics/SmithKline Beecham
Quest's acquisition of SB's clinical laboratory operations did not close on July 2, as had been previously expected, due to difficulties in finalizing an ancillary contract referred to as the definitive data access agreement. "The parties have been unable to agree on the extent to which SmithKline Beecham would have the right to commercialize information products utilizing Quest Diagnostics' laboratory data," according to a July 1 release. Quest shareholders approved the transaction June 29; either party can terminate the purchase agreement after Sept. 30, 1999, if the transaction has not closed (1"The Gray Sheet" Feb. 15, p. 27)