Shares of Rockville-based Life Technologies Inc. surged 24 percent yesterday with the news that Dexter Corp. has made an offer to buy the 48 percent of the company it doesn't own.
Shares in Life Technologies gained $7.50 to close at $38.50, above Dexter's bid of $37 per share.
Life Technologies develops, manufactures and markets more than 3,000 products for use in life science research and biomedical manufacturing. It has 1,800 employees, including more than 600 in Maryland.
Since Life Technologies' inception in 1983, Dexter, based in Windsor Locks, Conn., has been the majority shareholder. It controls 52 percent of Life Technologies.
When Dexter, a chemical company with $1.15 billion in sales last year, made the bid after the markets closed Tuesday, its offer was 19 percent higher than Life Technologies' closing price of $31. But some say yesterday's rise in the stock price means Dexter's offer might fall short.
"I think $39 or $40 seems like a reasonable price to be paid," said Kevin I. Berg, an analyst at Oscar Gruss & Son Inc., who has "hold" rating on Life Technologies stock. "The offer was not out of line, but Wall Street believes the company deserves a higher premium. I think Dexter might very possibly come back with a higher offer."
Don't bet on it, said Dexter Chairman and Chief Executive Officer Grahame Walker.
"We made an offer to the board of Life Technologies, and that's the offer," he said. "We think it's very fair."
Walker declined to say what Dexter's next move would be if Life Technologies rejected the offer.
"This is a very important strategic move for Dexter Corp. in terms of repositioning itself for the next decade as a corporation that is focused on high growth markets," he said.
Life Technologies had $332.8 million in sales last year and net income of $32 million. Berg said revenue is expected to be about $360 million this year.
Joseph Stokes, senior vice president and chief financial officer of Life Technologies, said three independent members of his company's board -- those not affiliated with Dexter or Life Technologies -- will engage an independent financial adviser and legal adviser, neither of which has yet been selected, to determine whether the offer is fair and reasonably priced. The verdict is expected in about a month.
"Our position is that we will wait until the independent committee evaluates the offer and makes its recommendation to the board," he said. "We really do not have any comment."
Pub Date: 7/09/98