While the laboratory analytical and life science instrumentation industry has seen some significant business divestments in the past, such as the sale of GE Healthcare Life Sciences (now known as Cytiva) to Danaher in 2020, the overall trend in the industry for many years has largely been one of acquisition and consolidation. And this has taken place at all business scales, from eagerly acquisitive giants of the industry, such as Thermo Fisher Scientific, Danaher, and AMETEK, to name just a few, to smaller entities rapidly building up their laboratory presence, such as Verder Scientific and Calibre Scientific. But two significant divestments are now reshaping the competitive landscape, as Danaher divested itself of the Veralto business on September 30, and Revvity and PerkinElmer went their separate ways in March.
In SDi’s most recent Global Assessment Report (published in April 2023), we present the top 50 vendors in the industry as measured by total laboratory instrumentation revenue in 2022 (excluding diagnostics, process tools and any other products not considered within the report). In the published list, both of the then-combined companies are in the Top Ten; Danaher at #2 and the other at #7. Next year’s list will have to take these changes into account, but this post takes a look at how the rankings would have looked had the divestments already taken place. That is, if each company’s revenues for 2022 were split along the product lines retained and divested. To that end, it’s worth looking at the two deals in more detail.
In March of this year, New Mountain Capital acquired the Applied, Food and Enterprise Services business that is PerkinElmer for a consideration of up to $2.5 billion. PerkinElmer’s product lines include chromatography and mass spectrometry, spectroscopy and thermal analysis, along with a few smaller relevant laboratory product lines. This analytical business is strongly aligned with the markets covered by our Global Assessment Report, so that PerkinElmer would have ranked #12 in 2022, while Revvity would be #16. Revvity is the larger company, but much of its revenue is in diagnostics and other areas outside the scope of the Global Assessment Report. Revvity does, however, have significant revenues from a diverse group of life science instrumentation and laboratory automation categories, keeping it within the top twenty suppliers, as we measure them.
Meanwhile, Danaher announced its intention to spin out businesses from its Environmental and Applied Solutions division as a separate publicly traded company, to be known as Veralto, starting in the 4th quarter of this year. The majority of Veralto’s instrumentation product lines stem from Hach (water quality, spectroscopy, titration, etc.) and X-Rite (color measurement). On the 2022 leaderboard, Veralto would rank at #21. With PerkinElmer and Revvity now taking up two spots, Veralto is just pushed out of the top twenty. Danaher (without Veralto) would maintain its position at #2, with contributions from many important life science businesses, such as Cytiva, SCIEX, Beckman Coulter, Leica and others.
These divestments are a turning point in the industry, foreshadowing an exciting future with altered rankings and market dynamics. Stay tuned for further developments and insights from SDi as we track these transformative shifts. Interested in more information on the top 50 vendors in the industry? Check out our 2023 Global Assessment Report here.