Laboratory Corp of America Holdings said it would pay $6.1 billion for Covance Inc, which carries out trials for drugmakers, as its diagnostic services business faces pressure from reimbursement cuts.Covance's shares jumped 25 percent to $100.28, nearing LabCorp's offer price of $105 per share. LabCorp shares fell 8 percent to $100.38 as one analyst questioned how quickly cost savings could be achieved.Oppenheimer's Bret Jones said cost savings that support the rationale for the deal seem to be longer term and lack a clear path.The cash-and-stock deal allows LabCorp to expand into the fast-growing contract clinical trial market, add to its existing central labs business and benefit from Covance's presence outside the United States.
Covance Inc. is a drug development services company providing a range of early-stage and late-stage product development services on a worldwide basis primarily to the pharmaceutical, biotechnology and medical device industries. Shares of CVD traded higher by 25.58% or $20.435/share to $100.34. In the past year, the shares have traded as low as $73.57 and as high as $106.50. On average, 431830 shares of CVD exchange hands on a given day and today's volume is recorded at 9743344.
Laboratory Corporation of America Holdings is a clinical laboratory company in the United States. Shares of LH fell by 7.73% or $-8.45/share to $100.84. In the past year, the shares have traded as low as $87.01 and as high as $109.47. On average, 569958 shares of LH exchange hands on a given day and today's volume is recorded at 7081585.
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