Quidel Corporation will be acquiring the privately held Diagnostic Hybrids, Inc. for approximately $130 million in cash.

Diagnostic Hybrids, based in Athens, Ohio, is a market leader in manufacturing and commercializing direct fluorescent in vitro diagnostic assays used in hospital and reference laboratories for a variety of diseases, including viral respiratory infections, herpes, Chlamydia and other viral infections, and thyroid diseases. Diagnostic Hybrids leverages its antibody development and cell culture expertise to develop new products that address significant market opportunities.

The company's direct sales force serves over 700 North American customers, and its products are sold via distributors outside the United States.

'This is an exciting acquisition for Quidel as it meets our criteria as a financially sound and strategic opportunity to grow our business. Diagnostic Hybrids and its products are highly regarded in the industry, the company has a leading market share, and its product development pipeline sets a continuing positive trajectory for its business,' said Douglas Bryant, president and CEO of Quidel. 'In the hospital segment, direct fluorescent assays fill a customer need that is not met by point-of-care lateral flow or molecular diagnostics assays. The combined company will offer the marketplace a continuum of diagnostic tests for triaging patients, confirming diagnoses and providing actionable results to improve patient care,' Bryant continued.

Diagnostic Hybrids recognized $38 million in revenue in 2008, reflecting a three-year compounded annual organic growth rate of 21%.

'Diagnostic Hybrids will broaden Quidel's current portfolio into complementary non-seasonal infectious and autoimmune diseases and help diversify our revenue base. Moreover, Diagnostic Hybrids has a solid track record of generating strong and profitable sales growth,' said Bryant.

Quidel plans to operate Diagnostic Hybrids as a separate subsidiary, and Dr. Scholl will remain as president of Diagnostic Hybrids and become a senior vice president of Quidel. The acquisition is subject to customary closing conditions including expiration of the waiting period under the Hart-Scott-Rodino Act, and is expected to close in the first quarter of 2010. William Blair & Company, L.L.C. acted as the exclusive financial advisor to Diagnostic Hybrids.