Genzyme Announces Agreement to Sell Genetic Testing Business to LabCorp

15-09-2010: Genzyme Corporation announced that it has entered into an asset purchase agreement under which Laboratory Corporation of America Holdings (LabCorp) will acquire Genzyme Genetics for $925 million in cash.

Under the terms of the agreement, LabCorp will purchase the business in its entirety, including all testing services, technology, intellectual property rights, and its nine testing laboratories. LabCorp is committed to offer employment to the unit’s approximately 1900 employees upon closing, including senior management. The agreement is subject to customary closing conditions, including the Hart-Scott-Rodino Antitrust Improvements Act of 1976, with the goal of closing before the end of the year.

“This transaction demonstrates the strategic value of Genzyme Genetics and the strong franchise we’ve built over a twenty year period,” said Henri A. Termeer, chairman and chief executive officer of Genzyme Corporation. “It also shows how our management team is uniquely positioned to unlock the underappreciated value of Genzyme’s diverse businesses for shareholders. The completion of this sale allows us to focus our resources on core growth areas and create stronger returns on invested capital.”

Genzyme announced in May that it would seek strategic alternatives for three units as part of a five-part plan to increase shareholder value. The plan builds on the robust set of operational, organizational and board changes made over the past year to strengthen the company. Plans to divest the two other Genzyme business units, Diagnostic Products and Pharmaceutical intermediates, remain on track. Proceeds from these transactions may be used to finance the second half of the company’s $2 billion stock buyback to be completed by May 2011.

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