PHILADELPHIA -- SmithKline Beckman Corp. and International Clinical Laboratories Inc. announced Wednesday they have reached a definitive merger agreement under which ICL will be acquired by SmithKline Beckman.
ICL's Board of Directors has approved the merger agreement and recommended that its securityholders accept SmithKline Beckman's tender offer.
The offer is for all outstanding shares of common stock at $37 per share, 10 percent Convertible Subordinated Debentures Due 1997 at $2,658.62 per $1,000 principal amount and 7 percent Convertible Subordinated Debentures Due 2011 at $1,909.68 per $1,000 principal amount.
The net cost to SmithKline Beckman of the acquisition would be about $400 million.
The tender offer and withdrawal rights expire at midnight April 20, unless extended.
The offer is conditional upon, among other things, the tender of an amount of securities, which together with the shares owned by SmithKline Beckman -- and the 3 million shares presently owned by Corning Glass Works that SmithKline Beckman may require to be tendered into its offer - would represent at least a majority of ICL's outstanding shares on a fully diluted basis.
The merger agreement provides that after completion of the tender offer, each share of ICL not owned by SmithKline Beckman will be converted into $37 in cash without interest.
Henry Wendt, chairman and chief executive of SmithKline Beckman said: 'The agreement with ICL furthers our leadership in health care and life sciences. Clinical laboratory services is one of our key businesses, growing fast in both sales and earnings. The combination with ICL creates an exciting prospect for the future.'
William C. O'Neil, Jr., chairman, president and CEO of International Clinical Laboratories, said: 'The merger of these two leading companies will strengthen our capabilities to deliver high quality laboratory services across the entire country.'
Based in Nashville, Tenn., ICL operates 13 major clinical testing laboratories located mainly in the southern and western United States. ICL had sales of $205.5 million for the fiscal year ending Aug. 31, 1987, compared with $168.7 million a year earlier.
SmithKline Bio-Science Laboratories, the clinical laboratory business of SmithKline Beckman, is based in King of Prussia, Pa., and operates 22 regional laboratories. SKBL sales for 1987 totaled $431 million, a 15 percent increase over 1986.
SmithKline Beckman is a technology-intensive health care and life sciences company, marketing a broad line of prescription and proprietary products for human and animal health care as well as diagnostic and analytical products and services that facilitate the detection and treatment of disease and the advancement of biomedical research.
SmithKline Beckman had sales of $4.3 billion in 1987.
