General Electric Company (NYSE:GE) agreed to buy certain assets from Thermo Fisher Scientific Inc (NYSE:TMO) to expand its business operations in the life sciences sector and extend its bioprocessing manufacturing unit in Asia, Europe and the Americas.

General Electric GE

Terms of the agreement

Under the agreement, General Electric Company’s (NYSE:GE) Healthcare unit will pay approximately $1.06 billion to acquire the Hyclone cell culture media and sera, gene mutation and magnetic beads businesses of Thermo Fisher Scientific Inc (NYSE:TMO).

According to General Electric Company (NYSE:GE), the three acquired businesses generated approximately $250 million combined annual revenues last year.

The transaction is subject to customary closing conditions and regulatory approvals. Both companies say they expect to complete the transaction in the early part of this year.

Acquisition consistent with General Electric’s investment strategy

Acquiring the businesses will allow GE Healthcare to accelerate the development of innovative “end to end” technologies for cell biology research and cell therapy as well as manufacturing medicines and vaccines.

According to a General Electric Company (NYSE:GE) statement, the acquisition is in line with its investment strategy in high-technology and innovative businesses that deliver strong top-line growth and expanded margins. The company is one of the leaders in medical diagnostic technology worldwide. GE Healthcare’s Life Sciences business is worth around $4 billion, and focuses on delivering innovative products and services in the diagnostics, research and bio-pharmaceutical manufacturing sectors.

“Life Sciences is one of our strongest and fastest-growing business areas, driven by the world’s demand for improved diagnostics and new, safer medicines. Combining GE’s engineering expertise with our capabilities in life sciences is already bringing great benefits to industry, research and patients. This deal makes a good business even better and will help us realize our vision of bringing better healthcare to more people at lower cost,” said John Dineen, president and CEO of GE Healthcare.

General Electric Company (NYSE:GE) previously sold some of its healthcare units with lower margins. Last November, the company agreed to sell its single-patient-use consumables for respiratory care and anesthesiology business to CareFusion Corporation (NYSE:CFN) for approximately $500 million.

Thermo Fisher Scientific Inc (NYSE:TMO) decided to sell its three businesses to General Electric Company (NYSE:GE) to comply with its agreement with European regulators to gain approval for its $13.6 billion deal to purchase the genetic testing equipment division of Life Technologies Corp (NASDAQ:LIFE).