Sigma-Aldrich Acquires BioReliance

Life science and technology company, Sigma-Aldrich Corporation (SIAL - Analyst Report) completed the acquisition of BioReliance Holdings Inc., from private equity firm Avista Capital Partners for $350 million in cash.

Sigma-Aldrich expects the acquisition to be modestly accretive to its earnings per share in 2012. Further, the addition of BioReliance's industry-leading QA/QC testing services to Sigma’s product portfolio will enable Sigma to build better and more customized products. The acquisition is expected to extend Sigma’s reach into the promising new market of biologic drugs.

BioReliance Holdings provides biopharmaceutical testing services to pharmaceutical, biopharmaceutical, diagnostics and other life science customers. The company generated revenues of approximately $110 million in 2010.

In late October 2011, Sigma-Aldrich generated sales of $626 million in the third quarter of 2011, up 11% year over year. The results, however, missed the Zacks Consensus Estimate of $631 million.

Based in St. Louis, Missouri, Sigma-Aldrich Corporation is a leading life sciences and high technology company. The company is engaged in developing, manufacturing and distributing various biochemicals and organic chemicals.

Apart from acquisitions, in order to boost its growth, Sigma-Aldrich plans to increase its focus on marketing, business development, R&D while continuing with its efforts to improve process and operations management.

Sigma-Aldrich faces stiff competition from Bayer AG (BAYRY - Analyst Report) and privately held companies Brenntag AG and VWR International, LLC. We currently maintain a Zacks #3 Rank (short-term Hold recommendation) on Sigma and a long-term Neutral recommendation.

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