General Electric will not buy Abbott Laboratories' diagnostics business as planned, the companies said Wednesday, because they could not agree on the final terms of the proposed $8.13 billion deal. GE said the companies decided it was in both of their best interests to terminate their agreement and discussions.
"GE and Abbott worked diligently to complete the transaction but were unable to reach agreement on final terms and conditions," the Fairfield, Conn.-based company said in a statement. Abbott issued a nearly identical statement.
The deal to buy Abbott's core laboratory and point-of-care diagnostics business, first announced in January, had already been approved by regulators in the U.S. and Europe.
GE has been selling off slower-growth businesses such as insurance and plastics and focusing on faster-growth areas such as energy, oil and gas equipment, rail engines, health care technology, finance and water processing technology.
For Abbott, the deal came after a record buying binge in the past year or two. The company has acquired Guidant's vascular wing for $4.1 billion and Kos Pharmaceuticals for $3.7 billion.
Abbott said the decision to terminate the contract would have no impact on its second-quarter or full-year earnings guidance, excluding specified items. The North Chicago, Ill.-based company said its 2008 outlook also is unchanged.
Abbott shares fell $2.01, or 3.8 percent, to $51.20 in aftermarket electronic trading after rising 62 cents during the regular session. The stock is up 5 percent this year.
GE rose 11 cents to $38.31 in late activity after climbing 30 cents in traditional trading hours.
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