(Reuters) -Thermo Fisher Scientific would acquire Olink Holding AB in a deal valued at $3.1 billion, the companies said on Tuesday, as the U.S. medical equipment maker seeks to boost its life sciences portfolio that helps drug discovery.
The deal lifted Olink's U.S.-listed shares nearly 67% in early trading, while shares of Thermo Fisher (NYSE:TMO) were down over 1%.
Thermo Fisher has been struggling with softening demand for its life sciences offerings, which includes discovery and production of new drugs and vaccines, as its biotech clients face a funding crunch.
Sweden-based Olink provides products and services for advanced analysis of proteins that are key markers of multiple diseases, which in turn help in drug discovery and development.
Olink's acquisition will help Thermo Fisher's customers in the biotech industry "to meaningfully accelerate discovery and scientific breakthroughs," Thermo Fisher CEO Marc Casper said.
The deal also includes net cash of about $143 million.
Thermo Fisher said it would pay Olink shareholders $26 per share, an about 74% premium to the U.S.-listed stock's closing price on Monday.
Thermo Fisher plans to fund the transaction using its cash on hand and debt financing, and expects the deal to be closed by mid 2024.
The deal is a good fit for Thermo Fisher and "checks the box strategically," Evercore ISI analyst Vijay Kumar wrote in a note.
Olink is on track to generate over $200 million in revenue next year and, as part of Thermo Fisher, is expected to grow mid-teens organically, the companies said.