(Includes details from American Capital, updates stock prices)
DOW JONES NEWSWIRES
Corning Inc. (GLW) has acquired a maker of laboratory liquid
handling products from American Capital Ltd. (ACAS) for about $400
million in a move to bolster its life-sciences business.
Shares of American Capital, a publicly traded private-equity
firm, surged 31% to $3.38 while Corning was down 2 cents at
$15.78.
Wednesday's rally pushed American Capital's stock into the green
for the year, up 4.6%. The company's stock had been pressured amid
concerns about American Capital's debt levels and weakening
performance of its holdings.
American Capital said Wednesday afternoon, hours after the deal
was announced by Corning, that it would record a $35 million gain
on the sale and proceeds of $182 million. It put its compound
annual rate of return on California-based Axygen BioScience at
25%.
Senior managing director Darin Winn said American Capital has
received some $875 million of proceeds from selling portfolio
holdings the past year.
Corning, whose primary business is making fiber-optic cable and
glass for liquid-crystal displays, said the will allow its
life-sciences revenue to top $500 million by 2011. The figure was
$326 million last year.
Axygen founder Hemant Gupta will continue to lead the
business.
The acquisition comes as Corning struggles with falling glass
sales stemming from customers' inventory cutbacks. In July, Corning
said second-quarter income plunged 81% on a year-earlier gain and
falling margins, although results beat analysts' expectations.
Revenue decreased 18% to $1.4 billion.
-By Kevin Kingsbury, Dow Jones Newswires; 212-416-2354;
kevin.kingsbury@dowjones.com