Fujifilm, a multinational photography and imaging company headquartered in Tokyo, has entered into a definitive agreement to acquire Cellular Dynamics International (CDI), a developer and manufacturer of fully functioning human cells in industrial quantities to precise specifications, via an all-cash tender offer to be followed by a second step merger.
Fujifilm aims to acquire all issued and outstanding shares of CDI’s common stock for $16.5 per share or approximately $307 million (on a fully diluted basis). The offer represents a premium of 108% to CDI’s closing price on March 27. CDI will continue to run its operations in Madison, Wis., and Novato, Calif., as a consolidated subsidiary of Fujifilm. The announced transaction was approved unanimously by both companies’ boards of directors.
Fujifilm will commence an all-cash tender offer no later than April 6. The transaction is conditioned on the tender achieving the minimum acceptance threshold, regulatory approvals and other customary conditions. Fujifilm will finance the transaction from the cash on its balance sheet and the completion of the acquisition is not subject to any financing conditions. It is anticipated the tender offer will close during the second calendar quarter of 2015.
CDI’s technology platform enables the production of high-quality fully functioning human cells, including induced pluripotent stem cells (iPSCs), on an industrial scale. Customers use CDI’s products, among other purposes, for drug discovery and screening, to test the safety and efficacy of their small molecule and biological drug candidates, for stem cell banking and in the R&D of cellular therapeutics. CDI’s proprietary iCell product catalogue encompasses 12 different iPSC based cell types, including iCell Cardomyocytes, iCell Hepatocytes and iCell Neurons.
CDI’s technology platform was selected by the California Institute for Regenerative Medicine to establish iPS disease cell banks. CDI recently announced the completion of 2 cGMP-compliant iPS cell lines with HLA types, which may reduce the likelihood of transplant immune rejection. CDI also is developing iPS cells for preclinical studies focused on dry age-related macular degeneration for a National Eye Institute program.
Fujifilm has developed highly-biocompatible recombinant peptides that can be shaped into a variety of forms for use as a cellular scaffold in regenerative medicine in conjunction with CDI’s products. Fujifilm has been strengthening its presence in the regenerative medicine field over several years, including by acquiring a majority of shares of Japan Tissue Engineering (J-TEC) in December 2014.
This acquisition of CDI will allow Fujifilm to gain entry into the area of iPS cell-based drug discovery support services. Fujifilm also plans to benefit from the combination of CDI’s iPS cell technology and experience and Fujifilm’s experience in material science, engineering and J-TEC’s quality management systems. The combination of these will help accelerate product development in regenerative medicine while expanding the commercial opportunities.
Fujifilm has successfully transformed its business structure for growth by expanding from traditional photographic film to other priority business fields. Positioning the healthcare business as one of its key growth areas, Fujifilm is seeking to cover "prevention, diagnosis and treatment" comprehensively.