Thermo Fisher Agrees to Buy a Solventum Business for $4.1 Billion

— Jeff Ward, Lehigh Valley News Briefs

Thermo Fisher Scientific, a maker of medical and laboratory equipment, has agreed to acquire Solventum’s purification and filtration business for $4.1 billion in cash.

Thermo Fisher, which has operations in the Lehigh Valley, said the Solventum business has about 2,500 employees and $1 billion in annual revenue. The business has locations across the globe.

The deal will be complete by the end of 2025, according to a Thermo Fisher statement.

Here is the expected effect on earnings, according to Thermo Fisher: “In the first year of ownership, the transaction is expected to be dilutive to adjusted EPS by $0.06. Excluding financing costs, the transaction is expected to be accretive by $0.28 in that period.”

Shares of Thermo Fisher (NYSE:TMO) traded at $563.25, up 70 cent, at 10 a.m. Shares of Minnesota-based Solventeum (NYSE:SOLV) reached $82.88, up $6.60.

Here is a cut-and-paste version of the statement:

WALTHAM, Mass.–(BUSINESS WIRE)– Thermo Fisher Scientific Inc. (NYSE: TMO) (“Thermo Fisher”), the world leader in serving science, today announced that the company has entered into a definitive agreement with Solventum (NYSE: SOLV) to acquire Solventum’s Purification & Filtration business for approximately $4.1 billion in cash.

Solventum’s Purification & Filtration business is a leading provider of purification and filtration technologies used in the production of biologics as well as in medical technologies and industrial applications. The Solventum business operates globally with sites across the Americas, Europe, the Middle East, Africa, and the Asia-Pacific region, and has approximately 2,500 colleagues. In 2024, Solventum’s Purification & Filtration business generated approximately $1 billion of revenue.

Solventum’s Purification & Filtration business is highly complementary to Thermo Fisher’s bioproduction business. Today, Thermo Fisher has a leading portfolio of offerings in cell culture media and single-use technologies. Solventum’s innovative filtration portfolio broadens Thermo Fisher’s capabilities in the development and manufacturing of biologics, spanning upstream and downstream workflows.

“The addition of Solventum’s business is an outstanding strategic fit with our company and will create significant value for our customers and shareholders,” said Marc N. Casper, chairman, president and chief executive officer of Thermo Fisher. “Solventum’s portfolio of solutions will be valued by our customers, and further demonstrate our disciplined capital deployment strategy which has an excellent track record of creating shareholder value.”

Casper continued, “As the trusted partner to our customers, Solventum’s Purification & Filtration business will expand and add differentiated capabilities to our bioprocessing portfolio to better serve our customers in this rapidly growing market. We look forward to welcoming our new colleagues to Thermo Fisher.”

The transaction is expected to be completed by the end of 2025 and is subject to customary closing conditions and regulatory approvals. Once the transaction closes, Solventum’s Purification & Filtration business will become part of Thermo Fisher’s Life Sciences Solutions segment.

Solventum’s Purification & Filtration, as part of Thermo Fisher, is expected to generate mid- to high-single digit organic growth and the application of the PPI Business System will enable strong margin expansion and meaningful synergy realization. In the first year of ownership, the transaction is expected to be dilutive to adjusted EPS¹ by $0.06. Excluding financing costs, the transaction is expected to be accretive by $0.28 in that period. This reflects the very strong day one cost synergies when Solventum’s allocated segment costs are replaced by lower run rate costs within Thermo Fisher, partially offset in year one by one-time business stand up costs. Thermo Fisher expects to realize approximately $125 million of adjusted operating income from revenue and cost synergies by year five following the close. The expected long-term business growth, margin expansion opportunity and synergy realization make the financial returns on the transaction very compelling with a double-digit internal rate of return.

¹ Adjusted earnings per share and adjusted operating income are non-GAAP measures that exclude certain items detailed later in this press release under the heading “Use of Non-GAAP Financial Measures.”

Advisors

For Thermo Fisher, WilmerHale is serving as principal deal counsel and Wells Fargo as exclusive financial advisor.

About Thermo Fisher Scientific

Thermo Fisher Scientific Inc. is the world leader in serving science, with annual revenue over $40 billion. Our Mission is to enable our customers to make the world healthier, cleaner and safer. Whether our customers are accelerating life sciences research, solving complex analytical challenges, increasing productivity in their laboratories, improving patient health through diagnostics or the development and manufacture of life-changing therapies, we are here to support them. Our global team delivers an unrivaled combination of innovative technologies, purchasing convenience and pharmaceutical services through our industry-leading brands, including Thermo Scientific, Applied Biosystems, Invitrogen, Fisher Scientific, Unity Lab Services, Patheon and PPD. For more information, please visit www.thermofisher.com.