Investors reacted positively to Danaher's announcement that it had agreed to acquire Beckman Coulter for an overall total of $6.8 billion, its biggest ever takeover deal.
Danaher's stock was up 2% on the deal news, reflecting the consensus that diagnostics has a positive future what with ageing populations around the world.
With annual revenues of approximately $3.7 billion, Beckman Coulter develops, manufactures and markets products that simplify, automate and innovate complex biomedical testing.
The purchase price represents 1.8x sales and 8x EBITDA - in line with past deal multiples offered by Danaher.
Beckman Coulter effectively put itself up for sale in December 2010 after a series of bad news stories hit the company, including a damaging product recall and departure of its CEO.
The high price paid was as a result of a competitive bidding war for Beckman which included several private equity companies. In addition, it was reported that Thermo Fisher was interested in making a bid.
As a result the price had to be right in order to attract investor attention.