Molecular Devices Announces Definitive Agreement to Acquire Axon Instruments
March 21 2004 - 2:54PM
PR Newswire (US)
Molecular Devices Announces Definitive Agreement to Acquire Axon
Instruments SUNNYVALE, Calif., March 21 /PRNewswire-FirstCall/ --
Molecular Devices Corporation today announced that it has entered
into a definitive agreement to acquire Axon Instruments, Inc., for
approximately U.S. $70 million in cash and approximately U.S. $70
million in Molecular Devices common stock (based on a current
average stock price). In addition, Molecular Devices will assume
Axon's approximately U.S. $29 million in cash and marketable
securities. This strategic transaction would expand Molecular
Devices' product portfolio with systems for cellular neurosciences
and genomics and combine complementary product lines in the
fast-growing areas of high throughput imaging and
electrophysiology. Among the expected benefits of the acquisition
are product development synergies and improved distribution of
Axon's products through Molecular Devices' worldwide sales and
marketing organization. Established in 1983, Axon is a pioneer in
the field of electrophysiology, the preferred method for studying
ion channels, an area of significant interest to pharmaceutical
companies and life sciences researchers. Axon's products for
electrophysiology address a wide range of customer needs, from
lower-throughput research tools to the PatchXpress system for
automated ion channel analysis. Axon also offers a popular line of
instruments for scanning DNA and protein arrays and the ImageXpress
system for high throughput biology applications. Axon achieved
revenues of U.S. $33.5 million in 2003 and was profitable on both
an operating and a net income basis. Axon employs 128 people,
primarily in its Union City, California headquarters. Commenting on
the transaction, Dr. Joseph Keegan, President and Chief Executive
Officer of Molecular Devices, said, "This acquisition is an
exciting opportunity for Molecular Devices to broaden our footprint
in our core drug discovery and life sciences markets and further
strengthen our technology base. Both Molecular Devices and Axon
possess world-class engineering and longstanding track records for
delivering innovative products. Together, we would have an
exceptional capability to provide enabling technology in areas of
great importance to pharmaceutical and life sciences customers,
including genomics, imaging, and the screening of GPCRs, kinases
and ion channels." Dr. Alan Finkel, Chief Executive Officer of
Axon, added, "Molecular Devices' technological expertise, market
presence, and excellent reputation make it an ideal partner for
Axon. This combination would enhance the visibility of Axon's
products and accelerate the development of innovative new products,
particularly in the areas of imaging and ion channel screening."
After the closing of the transaction, it is anticipated that Dr.
Finkel will become Vice President and Chief Technology Officer of
Molecular Devices, reporting to Dr. Keegan, who will remain
President and Chief Executive Officer. As previously announced,
Geoffrey Powell will retire from the position of President of Axon
after the closing of the transaction. Under the terms of the
transaction, each share of Axon common stock would be converted
into the right to receive U.S. $0.1359 in cash and 0.00734 of a
share of Molecular Devices common stock. A substantial portion of
the equity held in Axon is traded on the Australian Stock Exchange
(ASX) in CUFS; each CUFS holder would also receive U.S. $0.1359 in
cash and 0.00734 of a share of Molecular Devices common stock for
each share of Axon common stock subject to a CUFS. Holders of
options, other than those issued under Axon's employee option
plans, would receive cash and shares of Molecular Devices common
stock in the same amounts as they would have received had they
exercised their options immediately prior to the effective date of
the acquisition, net of the option exercise price. Molecular
Devices would also assume outstanding options to purchase Axon
common stock issued under Axon's employee option plans, which would
convert into options to purchase common stock of Molecular Devices.
The transaction is subject to customary closing conditions,
including approval of the transaction by the stockholders of
Molecular Devices and the shareholders of Axon, Hart-Scott-Rodino
clearance and the effectiveness of a registration statement with
the Securities and Exchange Commission. If the transaction closes
by the end of the second quarter of 2004, Molecular Devices would
anticipate increasing its revenue guidance for the second half of
2004 by $20 million, bringing it to a range of $145 million to $155
million for the full year. Molecular Devices also expects that it
would realize $4 million to $5 million in expense synergies on an
annualized basis. The transaction is expected to be neutral to
earnings per share guidance for 2004 and Molecular Devices
anticipates maintaining its current EPS guidance of $0.65 to $0.75
for the year. While Molecular Devices has not established guidance
for 2005, the transaction is expected to be accretive to the EPS
generated by Molecular Devices on a stand-alone basis in 2005.
Conference Call Information Molecular Devices will host a
conference call on Monday, March 22 at 8:00 a.m. PST (11:00 a.m.
EST). Interested parties can participate in the call by dialing
800-967-7141 (domestic) or 719-457-2630 (international). A taped
replay of this call will be available through April 2, 2004. Replay
dial-in numbers are 888-203-1112 (domestic) and 719-457-0820
(international) and the access code for the replay is 583884.
Investors can also access a live web- cast of the call through a
link posted on the investor page on Molecular Devices' website
(http://www.moleculardevices.com/). A replay of the web-cast will
remain at this location through April 2, 2004. About Molecular
Devices Corporation Molecular Devices Corporation is a leading
developer of high-performance, bioanalytical measurement systems
that accelerate and improve drug discovery and other life sciences
research. Molecular Devices' systems and consumables enable
pharmaceutical and biotechnology companies to leverage advances in
genomics and combinatorial chemistry by facilitating the
high-throughput and cost-effective identification and evaluationof
drug technologies that integrate its expertise in engineering,
molecular and cell biology, and chemistry. Molecular Devices
enables its customers to improve research productivity and
effectiveness, which ultimately accelerates the complex process of
discovering and developing new drugs. About Axon Instruments, Inc.
Axon Instruments, Inc., (http://www.axon.com/) produces a broad
spectrum of instrumentation and software for cellular
neurosciences, genomics, and cell- based screening. In cellular
neurosciences and genomics, Axon is widely recognized as one of the
world's pre-eminent manufacturers of drug discovery
instrumentation. The company's goal is to produce a range of
superior yet affordable instrument and software systems for drug
discovery aimed at the pharmaceutical industry, biotechnology
companies, and academic researchers. Founded in 1983 and located in
Union City, California and Melbourne, Australia, Axon Instruments
is a California corporation listed on the Australian Stock Exchange
(symbol: AXN.AX). Forward-Looking Statements This press release
contains "forward-looking" statements, including statements related
to the success of the acquisition and potential future revenues,
expense synergies and earnings. Any statements contained in this
press release that are not statements of historical fact may be
deemed to be forward-looking statements. Words such as "believes,"
"anticipates," "plans," "expects," "will," and similar expressions
are intended to identify forward- looking statements. The success
of the acquisition and future operating results of Molecular
Devices may differ materially from the results discussed or
forecasted in the forward-looking statements due to factors that
include, but are not limited to, risks associated with
acquisitions, such as the potential inability to realize the
expected benefits and synergies of the transaction, risks related
to future opportunities and plans for the combined company,
potential difficulties in the assimilation of operations,
strategies, technologies and products of the acquired company, the
risk of loss of key personnel of the acquired company and the risk
of diversion of management attention from other business concerns,
and general business risks including, among others, risks detailed
from time to time in Molecular Devices' SEC reports, including its
Annual Report on Form 10-K for the year ended December 31, 2003.
Molecular Devices Corporation does not undertake any obligation to
update forward-looking statements. Additional Information and Where
to Find It Molecular Devices Corporation plans to file a
Registration Statement on SEC Form S-4 in connection with the
merger, and Molecular Devices and Axon expect to mail a Joint Proxy
Statement/Prospectus to stockholders of Molecular Devices and
shareholders of Axon containing information about the merger.
Investors and security holders are urged to read the Registration
Statement and the Joint Proxy Statement/Prospectus carefully when
they are available. The Registration Statement and the Joint Proxy
Statement/Prospectus will contain important information about
Molecular Devices, Axon, the merger and related matters. Investors
and security holders will be able to obtain free copies of these
documents through the website maintained by the U.S. Securities and
Exchange Commission at http://www.sec.gov/. Free copies of the
Joint Proxy Statement/Prospectus and these other documents may also
be obtained from Molecular Devices by directing a request through
theInvestors portion of Molecular Devices' website at
http://www.moleculardevices.com/ or by mail to Molecular Devices
Corporation, 1311 Orleans Drive, Sunnyvale, California, 94089,
attention: Investor Relations, telephone: (408) 747-3533. In
addition to the Registration Statement and the Joint Proxy
Statement/Prospectus, Molecular Devices files annual, quarterly and
special reports, proxy statements and other information with the
Securities and Exchange Commission. You may read and copy any
reports, statements or other information filed by Molecular Devices
at the SEC public reference room at 450 Fifth Street, N.W.,
Washington, D.C. 20549. Please call the Commission at 1-
800-SEC-0330 for further information on the public reference room.
Molecular Devices' filings with the Commission are also available
to the public from commercial document-retrieval services and at
the website maintained by the Commission at http://www.sec.gov/.
Interests of Certain Persons in the Merger Molecular Devices will
solicit proxies from Molecular Devices' stockholders in favor of
the issuance of shares of Molecular Devices' common stock in the
merger. The directors and executive officers of Molecular Devices
and the directors and executive officers of Axon may be deemed to
be participants in Molecular Devices' solicitation of proxies.
Certain executive officers and directors of Axon have interests in
the merger that may differ from the interests of stockholders
generally. These interests will be described in the Joint Proxy
Statement/Prospectus when it becomes available. DATASOURCE:
Molecular Devices Corporation CONTACT: Tim Harkness of Molecular
Devices Corporation, +1-408-747-3533 Web site:
http://www.moleculardevices.com/ http://www.axon.com/
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