Abaxis acquired by Zoetis
Context
Zoetis entered into a definitive merger agreement to acquire all outstanding common shares of point-of-care diagnostics specialist Abaxis. The transaction was executed as an all-cash tender offer of $83 per share, financed through a combination of existing balance-sheet cash reserves and new debt issuance. Announced on May 16, 2018, and completed later that year, the strategic acquisition positions Zoetis to capture market share across the veterinary point-of-care diagnostics segment, an industry valued at over $3 billion that expanded at a 10% compound annual growth rate over the preceding three years. At the time of announcement, Abaxis recorded annual revenue of $245M for its fiscal year ended March 31, 2018, up 8% year-over-year, deriving 83% ($201.9 million) from veterinary testing and 16% ($38.6 million) from human medical diagnostics, with consumable discs and cartridges generating 78% of revenues ($191.3 million) across a team of more than 580 employees. Abaxis generated 20% of its fiscal 2018 sales internationally, whereas Zoetis posted 2017 revenue of $5.3 billion with approximately 9,000 employees, direct operations in 45 countries, and commercial distribution in over 100 countries. In structuring the transaction, Zoetis retained Guggenheim Securities and Barclays as financial advisors alongside Wachtell, Lipton, Rosen & Katz as legal advisor, while Abaxis was advised financially by Piper Jaffray as exclusive advisor and legally by Cooley LLP. This build-up enables Zoetis to scale the VetScan instrument and consumable portfolio globally, building an integrated continuum of animal care and delivering accretive earnings per share beginning in 2019.
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Target
Abaxis develops, manufactures, and markets portable blood analysis systems and biological testing consumables since its founding in 1989 in Union City, California. The company focuses its commercial operations on its VetScan product line for veterinary practices and its Piccolo portfolio for human healthcare applications, offering automated benchtop instruments for chemistry, hematology, and urine sediment analysis. Its business model relies on placing analytical laboratory hardware alongside the recurring sale of proprietary single-use consumables, including reagent discs, rapid assay kits, and diagnostic cartridges. The organization also provides bi-directional software connectivity tools designed to integrate its point-of-care testing units directly with clinical practice management systems. By delivering immediate blood profile measurements within local clinics, the enterprise addresses the medical requirements of decentralized point-of-care diagnostics across clinical settings.
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REFERENCES
Valuation range: EV 1b - 4b USD
Revenue range: 150M - 250M USD
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Authors: verified mynth contributor (mynth data is contributed by M&A / PE professionals and systematically cross-verified with private deal documents and official press releases).
Press release: view release
Target: abaxis
Acquirer: zoetis