On June 4 it was reported that lab-testing company Laboratory Corp of America Holdings (LH.N) will buy smaller rival Medtox Scientific Inc. (MTOX.O) for $27 a share, or about $245 million, in cash.

The deal, which represents a premium of 37 percent over Medtox’s Friday close of $19.70, has been approved by the boards of both companies and is expected to close in the third quarter of 2012.

“This acquisition provides a strong foundation for growth in (the specialized toxicology testing) business, as we build and expand LabCorp’s toxicology center of excellence,” Laboratory Corp’s CEO David King said in a statement.

LabCorp with annual earnings of about $6-billion, saw their shares trading at $82.80 in early morning trade Monday on the New York Stock Exchange.

Medtoc Customer Letter

To Our Valued MEDTOX Clients:

MEDTOX Scientific is pleased to announce that we have signed an agreement to become part of Laboratory Corporation of America Holdings’ Toxicology Center of Excellence. We believe this transaction will successfully combine the quality and service you receive from MEDTOX with LabCorp’s substantial resources on both national and international levels. The transaction is subject to the satisfaction of customary closing conditions set forth in the agreement, including the expiration or early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. Until then, the companies will continue to conduct business separately.

Although the transaction is subject to shareholder and regulatory approval, we look forward to a new and exciting future as we expand our service capabilities and analytical competencies. We will continue offering customers a high level of service on a daily basis while presenting them with many new opportunities resulting from the size, scale and professionalism of LabCorp.

If you have any questions regarding this transaction, please contact your MEDTOX Sales Representative or Customer Service team.

Sincerely,

Richard Braun
Chief Executive Officer
MEDTOX Scientific, Inc.