Ending a prolonged legal battle, Abbott Laboratories recently agreed to buy Alere at a reside price of $4.48 billion. Alere specializes in the manufacture of rapid point-of-care diagnostic tests. The deal will help Abbott expand in point-of-care diagnostic testing, a market that is growing as physicians increasingly adopt rapid tests that speed up treatment.
As per the agreement, Abbott will pay $51 per share, a premium of 21 percent to Alere's closing price on Thursday. This rate is less than the earlier $56-per-share price announced in February last year. In April 2016, Abbott had raised concerns about the accuracy of various representations, warranties and covenants made by Alere in last year's $5.8 billion merger agreement, and offered to pay $30 million to $50 million to terminate the deal.
In 2016, Alere sued Abbott in an attempt to force the company to move ahead with the deal. In December, Abbott filed a suit to terminate its proposed acquisition of Alere. Abbott cited a "substantial loss" in the value of the diagnostics company since they struck a deal in February 2016.
In April 2017, Abbott and Alere announced that they had agreed to dismiss their respective lawsuits. The deal is expected to close by the end of the third quarter of 2017.
A diversified healthcare company, Abbott offers a wide range of diagnostic products, including point-of-care testing systems such as Abbott i-STAT 1 analyzer.