PerkinElmer Expects to Make Acquisitions After $500M Business Sale: CEO Talks Boston-Area Talent and Growth in Software, Imaging
PerkinElmer has recently struck a deal that it hopes will fuel its growth in the human and environmental health markets, among other things. Rob Friel, the chairman and chief executive of the Waltham, MA-based maker of lab analytical tools, gave me his personal take on his firm’s (NYSE: PKI) sale of its illumination and detection solutions (IDS) business in an interview last week.
The company took in $482 million from the sale of IDS to the New York-based private equity firm Veritas Capital. The deal works well with its strategy to invest more money into growing its core businesses that serve customers in the diagnostics, biotech/pharma, and environmental health markets. (Read on for more on what Friel said to Xconomy about using some of the proceeds from the IDS sale to fund acquisitions.)
While shedding IDS, which made specialty lighting and sensor components, PerkinElmer has been buying up firms in the diagnostics market—where the company sees high growth potential as healthcare dollars move toward preventive measures, Friel says. In July, the firm bought VisEn Medical, a Bedford, MA-based maker of in vivo florescence imaging technology, for $29.8 million. (Friel talked to us about the potential of that technology both in lab experiments and potentially downstream for clinical use in patients.) And back in May, PerkinElmer acquired Signature Genomic Laboratories of Spokane, WA, and its genetic testing technology for finding chromosomal abnormalities behind unexplained developmental disabilities, in a $90 million buyout deal.
In our interview, PerkinElmer’s chief also gave his take on where he sees the global economy heading. The poor economy has been cited for the company’s rounds of layoffs over the past two years. It has let go 452 workers through three layoff plans since early 2009. Also, there are 3,000 people in PerkinElmer’s IDS business that will no longer work for the company after its sale to Veritas. But Friel talked about his expectation that his company, which had 2009 sales of $1.8 billion and 8,200 employees at the end of last year, would get larger as it acquires new businesses and expands existing businesses.
Here’s an excerpt from my interview with Friel about how his company plans to grow through acquisitions and organically, as well as how talented workers and internal innovation play an important part at PerkinElmer. Also, read further for his expectation for the role of software and IT systems in advancing the firm’s offerings for human health and environmental safety customers.
Xconomy: Regarding PerkinElmer’s sale of its illumination and detection business, why is this an important deal for the company?
Rob Friel: It was a good business and well respected for what it did. But I think we wanted to be a little more focused. So this deal allows us to sell a … Next Page »