Abcam revealed that it had been in discussions with 30 other potential counterparties, including more than 20 potential strategic buyers, before entering into the agreement with Danaher. The deal means Danaher will pay $24 per share for Abcam, a 2.7% premium to Abcam's closing share price on Friday.

Founded in 1998 in Cambridge, UK, Abcam specialises in the supply of highly validated antibodies, reagents, biomarkers and assays to the scientific community. Abcam has more than 750,000 customers and will operate as a separate entity within Danaher's Life Sciences division. Its role is key to advancing the drug discovery process.

Headquartered in Washington, DC, Danaher Corporation designs, manufactures and markets professional, medical, industrial and commercial products and services. Its offerings include water quality analysis and treatment systems, diagnostic equipment, industrial automation and motion control systems, and cardiovascular devices. Danaher is using cash and commercial paper to finance the acquisition. The transaction is expected to result in an initial 2% increase in annual earnings per share, with synergies eventually reaching a quarter of Abcam's annual R&D overheads.

The acquisition of Abcam represents the latest addition to Danaher's strategic transactions. In 2021, it acquired biotech firm Aldevron, a supplier to Moderna, for $9.6 billion, and earlier in 2019, it bought General Electric's biopharmaceutical division for $21.4 billion.

The pharmaceutical and biotechnology sector has seen a significant uptick in deals this year, with a staggering $85 billion spent on acquisitions in the first five months of this year. This surge in M&A activity comes as companies look to replenish their drug portfolios in the wake of impending patent expiries. By comparison, the same period in 2022 saw deals worth only US$35.6 billion, while 2021 saw US$49.1 billion, according to investment bank Stifel. The increased M&A activity is primarily driven by the significant cash reserves that big pharma companies accumulated during the COVID-19 pandemic and investor concerns about future growth prospects.