At closing, the purchase consideration was valued at $107.19 per Covance share, consisting of $75.76 in cash and 0.2686 LabCorp shares for each Covance share, or an equity value of approximately $6.2 billion and an enterprise value of approximately $5.7 billion.
David P. King, chairman and CEO of LabCorp, said, "Our complementary services and capabilities will enable us to pursue multiple strategic opportunities in both the clinical laboratory and drug development businesses. Through this combination, we expect to achieve significant revenue growth and generate strong cash flows, allowing us to further invest in our business, fund future expansion and create value for our shareholders."
King said, "I have worked closely with the Covance team since November and am impressed with their talents and scientific expertise. Combined with the enormously talented people of LabCorp, we will employ our capabilities to enhance drug development, diagnostic services and the delivery of healthcare to better address the system's demand for improved outcomes at lower costs."
The combined company's headquarters are located in Burlington, N.C. Covance Drug Development will continue to operate under the Covance name, with its headquarters in Princeton, N.J.
The closing of the transaction follows the receipt of all necessary regulatory requirements and approval of the transaction by Covance shareholders on Feb. 18. With the closing of the transaction, Covance common stock will cease trading and will no longer be listed on the NYSE.