Cepheid shares jump after Danaher buys it in $4 billion deal

Shares of diagnostics company Cepheid soared Tuesday after technology conglomerate Danaher said it would buy the company for $4 billion, or $53 per share.  

Cepheid shares (CPHD) were up nearly 52% midday to $52.26. The stock closed Friday at $34.42. 

Best known for its GeneXpert System, which helps with genetic testing for infectious diseases, Cepheid generated annual revenue of $539 million in 2015. It expects to generate $618 million to $635 million in revenue in 2016.

Sunnyvale, California-based Cepheid will become part of Danaher's $5 billion diagnostics segment. The unit currently houses Danaher's Beckman Coulter, Leica Biosystems and Radiometer businesses.

Washington, D.C.-headquartered Danaher expects the deal to add 5 cents to its earnings per share in its first year following the acquisition and add 30 cents per share in the fifth year following the deal.

The purchase has been approved by both companies' boards and is expected to close by the end of the year.

Follow Eli Blumenthal on Twitter @eliblumenthal