The merger brings AB one step closer towards combining Sanger sequencing technology with next-generation technology to generate new markets for DNA sequencing.
Applied Biosystems has a history of bringing innovative DNA sequencing technology to the market, particularly sequencing technology and has been looking closely at this new approach that is said to massively speed up the tedious process of genetic analysis.
The new approach involves massively parallel fluorescence sequencing by stepwise ligation technology and has applications in de novo genome sequencing, medical sequencing, high throughput gene expression, and high throughput genotyping.
The APG technology combines single tube micro-bead sample preparation with high throughput multi-colour fluorescence imaging.
The sequencing chemistry uses ligation probes, an approach that provides very high quality data compared to competitive polymerase-based approaches.
Unlike similar technology, this approach does not produce homo-polymer sequencing errors. The system can use 'paired-end' reads, helpful in many genomic applications, such as pathogen sequencing and whole genome sequencing.
Currently the system generates 2x25 base pair reads with significant read length improvements anticipated. Prototype systems presently are producing high quality sequence data. APG has applied for several patents and has multiple technology licenses.
Under the terms of the agreement, the purchase will close in the third quarter, subject to regulatory and other closing conditions.
AB expects the deal to lower fiscal 2007 earnings by about 6 cents a share and cut fiscal 2008 results by an unspecified amount because of research and development spending, commercialisation costs and acquisition-related amortisation.
The company expects that acquisition to boost earnings beginning on fiscal 2009, excluding amortisation.
APG was incorporated in January 2005 as a separate entity owned by Agencourt Bioscience. Since the acquisition of Agencourt Bioscience by Beckman Coulter in May 2005, Beckman Coulter has owned 49 per cent of APG.