The Transaction

The Principals of Founders Investment Banking served as exclusive financial adviser to US Diagnostics, Inc. in its sale to Alere, Inc. (NYSE: ALR). US Diagnostics and Alere closed the transaction on July 10, 2015.

The Company

US Diagnostics is a leading provider of instant, on-site drug testing products designed for quick, accurate drug test results. Since the founding in 1998, US Diagnostics has provided customers “diagnostic testing packaged to go” for use in pre-employment screening, random and post-accident testing of employees. The Company exhibited substantial growth, expanded its customer base and coverage, and developed meaningful brand recognition in the industry.

Alere Inc. provides point-of-care diagnostics and services for infectious disease, cardiometabolic disease, and toxicology in the United States and internationally. The company operates through Professional Diagnostics and Consumer Diagnostics segments. Founded in 1981, Alere now employs almost 10,000 employees. The Company’s common stock is traded on the NYSE under the symbol “ALR.”

The Objective

Shareholders at US Diagnostics initially had reservations in promoting the company on a broad basis, but they learned about Founders confidential, process-based approach and chose to commit to the process, engaging Founders as its adviser to package and market the Company. US Diagnostics shareholders had built considerable value in the Company over the course of its 16 year history and were seeking full liquidity at a premium valuation, and the ability for the owner to exit after a short transition period.

The Solution

Founders Investment Banking performed a thorough assessment of the company and prepared a detailed marketing package and financial model to promote the company and build a market for US Diagnostics. Founders ran a complete sell-side process, and there was significant interest in the market for the Company. Founders qualified all of the potential buyers against the Seller’s personal and valuation goals and hosted a group of the top buyers to meet with the Company’s management team. Founders sourced LOI’s from all of these buyers and ultimately negotiated the final deal terms with Alere. The Shareholders and Founders selected Alere, navigated the diligence process and worked with legal counsel at Maynard Cooper to negotiate the terms of the Purchase Agreement. The transaction closed on July 10, 2015, successfully achieving:

  • Full liquidity for US Diagnostics shareholders
  • A premium valuation for the Company
  • Fair & equitable treatment of US Diagnostics employees post-transaction

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