Roper Industries to Acquire Sunquest Information Systems for $1.415B; Raises Guidance

Roper Industries, Inc. ROP today announced that it has entered into a definitive agreement to acquire Sunquest Information Systems, Inc., the leading provider of diagnostic and laboratory software solutions to healthcare providers, in an all cash transaction valued at $1.415 billion, including $25 million in cash tax benefits. Headquartered in Tucson, Arizona, Sunquest provides a comprehensive suite of clinical and anatomic laboratory software solutions. Sunquest's software solutions are used by more than 1,700 hospitals worldwide. Hospital laboratories, which provide information that drives the majority of diagnostic decisions, rely on Sunquest software solutions to integrate vital data and improve workflow. Sunquest also provides a growing suite of software solutions beyond the hospital laboratory with a focus on point-of-care patient safety and physician outreach. Roper expects the acquisition of Sunquest to be immediately cash accretive and to generate $140 million or more of EBITDA in 2013, excluding the impact of fair value accounting of Sunquest's deferred revenue. Sunquest is owned by a group of investors resulting from a 2010 recapitalization, led by Huntsman Gay Global Capital, in partnership with Vista Equity Partners, which has owned the company since 2007. "Sunquest meets all of Roper's key acquisition criteria and is an ideal fit with both our Medical and Software platforms," said Brian Jellison, Roper's Chairman, President and CEO. "The business is the market leader in software solutions for the critically important healthcare provider laboratory market. We expect Sunquest to benefit in all economic environments from very favorable market forces – an aging population, expansion of anatomic pathology, 2012 Outlook and Guidance Roper is increasing its full year adjusted diluted earnings per share guidance to $4.84 - $5.00 from $4.75 - $4.91, reflecting a ($0.04) reduction due to currency and $0.12 - $0.14 accretion from the acquisition of Sunquest. The company's guidance excludes acquisition-related expenses, debt extinguishment charges and the impact of any future acquisitions. The company's guidance includes the recognition of Sunquest's deferred revenue, a portion of which will be excluded under GAAP's purchase accounting rules which will require the deferred revenue to be reduced to fair value upon the acquisition.