Mergers and Acquisitions

* On March 13, 2014, Galapagos has announced the signing of a definitive agreement to sell the BioFocus and Argenta service division operations to Charles River Laboratories International, for a total consideration of up to €134 million. The transaction is subject to customary closing conditions and is expected to close early in the second quarter of 2014. Charles River agrees to pay Galapagos immediate cash consideration of €129 million. Upon achievement of a revenue target 12 months after transaction closing, Galapagos will be eligible to receive an earnout payment of €5 million. The purchase price implies a multiple of approximately 2 times 2013 sales and approximately 12 times 2013 adjusted EBITDA. Galapagos agrees to retain 5.4% of the €129 million cash consideration in an escrow account for 15 months.

Charles River acquires all service operations of BioFocus and Argenta in the UK and The Netherlands. The acquisition includes all client contracts, order pipeline, premises, equipment, and further obligations of BioFocus and Argenta. All employees of BioFocus and Argenta will move into the Charles River organization upon completion of the transaction, which is expected to occur early in the second quarter of 2014, subject to customary closing conditions. David Smith will join Charles River as Corporate Vice President, In Vitro Discovery Services and lead the transition.
Galapagos retains target discovery and assay development capabilities in Leiden for its R&D and alliance operations. Post-transaction, Galapagos will have three R&D sites in Mechelen, Belgium (headquarters), Romainville, France, and Leiden, the Netherlands. Galapagos also retains Fidelta, a fee-for-service operation based in Zagreb, Croatia. In total, Galapagos employs over 400 staff.