September 17, 2012 / 11:48 AM / 5 years ago

Complete Genomics to be bought by Chinese firm for $117.6 million

(Reuters) - Complete Genomics Inc GNOM.O said it would be bought by China's BGI-Shenzhen for $117.6 million, three months after the gene sequencing company started a strategic review.

Smaller gene sequencing companies like Complete Genomics and Pacific Biosciences (PACB.O), known for their aggressive pricing, have been facing intense competition from bigger industry players like Life Technologies Corp (LIFE.O) and Illumina Inc (ILMN.O).

The sector is also under pressure from a cut in funding by the National Institutes of Health (NIH) for basic science research. The budget squeeze could directly hurt the companies main academic and research customers.

The $3.15 per share offer by BGI-Shenzhen, which includes both non-profit genomic research institutes and sequencing application commercial units, represents an 18 percent premium to Complete Genomics stock's close on Friday.

Complete Genomics said it would get an additional up to $30 million in bridge financing for its operations following the deal, which is expected to close in early 2013.

In June, the Mountain View, California-based company said it was exploring strategic options, including a sale, and would cut about 20 percent of its workforce.

Citi is serving as financial adviser to BGI, while Complete is being advised by Jefferies & Co.

Complete Genomics shares, which have gained about 31 percent of their value since announcing a strategic review, closed at $2.67 on the Nasdaq on Friday.

Reporting By Vrinda Manocha and Balaji Sridharan in Bangalore; Editing by Sriraj Kalluvila

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