Corning buys Axygen Bioscience for $400 million
ROCHESTER, N.Y. — Specialty glass pioneer Corning Inc. said Wednesday it acquired laboratory equipment maker Axygen BioScience Inc. from American Capital Ltd. for about $400 million in cash to broaden its life sciences division.
Axygen, based in Union City, Calif., makes plastic consumable labware and liquid handling products for research labs. It employs 1,200 people and its founder, Hemant Gupta, will remain in charge of the 16-year-old business as president and chief executive.
Axygen’s products and distribution network “will significantly strengthen Corning’s life sciences platform and are critical components to our long-term growth strategy for this business,” Corning’s president, Peter Volanakis, said in a statement.
The buyout, he said, will enable Corning to push its life-sciences revenue above $500 million by 2011 from $326 million in 2008. The 157-year-old company, based in the city of Corning in western New York, also makes liquid-crystal-display glass, optical fiber and cable, and auto-pollution filters.
The move fits with Corning’s strategy of expanding beyond a heavy focus on one colossal product, which leaves it vulnerable to severe cyclical swings.
Its biggest business by far is ultra-thin LCD glass for flat-screen televisions and computers. It also remains the world’s biggest maker of optical fiber and cable, but lopsided investments in fiber optics came close to sinking the company during the dot-com bust in 2001.
Expanding its reach in laboratory services, an arena it entered with the invention of Pyrex glassware in 1915, “does help to achieve a more balanced portfolio,” said spokeswoman Kelli Hopp-Michlosky.
Late last year, panel makers slowed their LCD glass purchases dramatically to try and reduce a buildup in inventories as prices fell. In response, Corning took $165 million in first-quarter restructuring charges to pay for eliminating 3,500 jobs, or 13 percent of its payroll of 27,000.
In July, Corning reported its second-quarter profit skidded 81 percent from results inflated by a big one-time gain a year earlier as sales fell 18 percent to $1.4 billion. The company, however, still beat Wall Street expectations on resurgent demand for its LCD monitors.
Corning shares fell 32 cents, or 2 percent, to $15.48 in midday trading Wednesday. The stock has traded in a 52-week range of $7.36 to $17.71.
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