2nd UPDATE: Danaher To Acquire Genetix For $102.8 Million

Danaher Corp. (DHR) agreed to acquire Genetix Group PLC (GTX.LN) in a deal valued at GBP63.4 million ($102.8 million), the latest medical technology acquisition this year for the manufacturing conglomerate.

Danaher will end up paying GBP50 million ($82 million), net of Genetix's cash on hand.

Genetix holders will receive 85 pence a share, a 35% premium to Thursday's closing price in London. The deal, expected to close in the first quarter, has the approval of the imaging and diagnostic company's board while investors representing 83% of Genetix's shares have indicated they will back the offer, with 78% agreeing to back it even in the event of a competing offer being made.

Genetix Chief Executive Charles De Rohan told Dow Jones Newswires the deal will bring together the Leica digital scanners of Danaher and Genetix's imaging software, which is used by scientists and drug developers to view digital images of cells. The two technologies are complementary, he added.

Genetix also gains access to more capital and new markets through the takeover.

Danaher CEO Lawrence Culp last month indicated the company saw plenty of opportunities for acquisitions owing to its cash reserves. The company's free cash flow, or cash left over after capital expenditures, has exceeded the company's income for 17 consecutive years. Through the first nine months of 2009, the company generated $1.19 billion of free cash.

The U.S. company, whose business lines range from making Craftsman tools to orthodontic braces, relies on acquisitions to drive annual revenue higher. As of Nov. 11, the company this year had announced deals expected to boost its annual revenue by $1 billion.

Culp in November said the company is likely to focus its deal-making activities in medical technology, testing and measurement instruments, dental equipment and product-identification technology used to track inventories of food, pharmaceuticals and other consumer products.

Danaher shares closed Thursday at $74.45 and didn't trade premarket.

-By Jason Douglas, Dow Jones Newswires; 44-20-7842-9272; [e-mail]

(Tess Stynes and Bob Tita contributed to this article.)