Abbott ( ABT) agreed to sell its core laboratory diagnostics business to GE ( GE) for $8.13 billion in cash.
Abbott Park, Ill.-based Abbott said the deal, which includes its Abbott Diagnostics and Abbott Point of Care units, will reap $6 billion in after-tax proceeds. Abbott's Molecular Diagnostics and Diabetes Care units will remain part of Abbott. GE said the addition of two of Abbott's core laboratory diagnostics businesses will broaden GE Healthcare's diagnostic offerings. The moves comes on the heels of GE's decision to sell its plastics business. "This acquisition is consistent with GE's strategy to invest in high-technology global infrastructure businesses that deliver strong top-line growth, earnings expansion and expanded margins," CEO Jeffrey Immelt said. "Abbott's diagnostics business is the premier platform in this industry and fits very well with our Healthcare strategy. Abbott's global position in the growing diagnostics field is aligned with our objective to deliver a comprehensive array of diagnostic products to customers around the world." GE said the acquisition reflects GE Healthcare's strategy to combine early diagnosis with information technology to enable a new "early health" model of care focused on earlier diagnosis, pre-symptomatic disease detection and disease prevention. GE said the transaction will be accretive to earnings. For Abbott, the transaction is expected to be neutral to earnings-per-share in 2007 before specified items and accretive thereafter.