Abbott To Sell Generic Drug Unit To Mylan For $5.3 Billion
Abbott Labs headquarters in Illinois Photograph by Daniel Acker — Bloomberg via Getty Images

Abbott Labs Is Boosting Its Diagnostic Business With This Big Buy

Feb 01, 2016

Abbott Laboratories (abt) said it would buy Alere (alr) for $5.8 billion in a deal that would expand its diagnostics business and make it a leader in point-of-care testing.

Point-of-care tests help increase the speed of treatment by bringing test results to doctors in a matter of minutes as they can be conducted in the physician's office, an ambulance or even at home.

Alere, which has annual sales of $2.5 billion, makes tests for infections such as HIV, tuberculosis, malaria and dengue.

Abbott will pay $56 per share in cash, a premium of about 51% to Alere's Friday closing. Alere shares were trading at $53.83 on Monday. Abbott was down 1.7%.

Abbott , which had annual sales of $20.4 billion in 2015, said its total diagnostics sales would exceed $7 billion after the close of the deal.

Abbott , which makes products ranging from Similac infant formula to Ensure beverages for adults, reported lower-than-expected quarterly revenue for the first time in four quarters last week, due to a strong dollar.

The deal will immediately add to Abbott 's earnings per share upon close and contribute significantly thereafter, the companies said.

All products and services featured are based solely on editorial selection. FORTUNE may receive compensation for some links to products and services on this website.

Quotes delayed at least 15 minutes. Market data provided by Interactive Data. ETF and Mutual Fund data provided by Morningstar, Inc. Dow Jones Terms & Conditions: S&P Index data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Terms & Conditions. Powered and implemented by Interactive Data Managed Solutions