MDS Sells Diagnostics Business for $1.19 Billion

In a move designed to shift the company's business focus from laboratory services to the life sciences market, MDS Inc., has agreed to sell its Canadian laboratory services business, MDS Diagnostic Services (Toronto, Canada), to Borealis Infrastructure Management Inc. (Toronto, Canada), for U.S.$1.19 billion.

Borealis is an investment entity of Ontario Municipal Employees Retirement System (OMERS). MDS Diagnostic Services has annualized revenues of U.S.$ 200.1 million and over 2,900 employees.

A portion of the purchase price may be retained for up to 18 months, contingent on the satisfaction of specific transition obligations of MDS. The transaction is subject to conditions and customary approvals, including regulatory consents and approval from the shareholders of LPBP Inc., a banking company and limited partner of the entity that owns the assets used in the Ontario laboratory business. The transaction is expected to close by the end of January 2007.

"The sale of our diagnostics business represents a major milestone for MDS in the transition to a global life sciences company,” said Stephen P. DeFalco, president and
CEO, MDS Inc. "We will be able to focus exclusively on life sciences markets, where incredible advances are being made to diagnose and treat diseases. This agreement represents a great outcome for our shareholders, our employees and the customers we serve.”

MDS has franchises in drug discovery instruments, molecular imaging, radiopharmaceutics, and contract research services for pharmaceutical and biotech clients. These businesses provide products and services to enable the development of new drugs and diagnostics. Borealis is involved in infrastructure investing, with assets in energy, transportation, and infrastructure buildings, including long-term care facilities and hospitals, pipelines, and telecommunications.



Related Links:
MDS Diagnostic Services
Borealis Infrastructure Management