Bloomberg on Danaher

At Bloomberg, Justin Fox writes about Danaher (DHR), one of our favorites.

Every once in a while a business journalist notices how well Danaher Corp. has performed during the past few decades, and feels compelled to remark upon it. Well, now I’ve noticed, and I guess the most appropriate remark is, “wow.” Or maybe “jeepers.”

There are a few companies with even more impressive long-run returns than this — Berkshire Hathaway and Altria since the late 1960s; Microsoft and Oracle since their 1986 initial public offerings. But everybody knows about them (well, maybe Altria is a surprise). Danaher is in rarified territory, but it doesn’t get much attention.

What does the Washington-based company do? It makes essential-but-obscure stuff — engine brakes for trucks, testing equipment for electronics, diagnostic instruments for doctors, braces for your teeth. The big name-brand exception used to be the Craftsman hand tools sold at Sears, but Danaher sold that business to Bain in 2012. Such dealmaking is core to the company’s identity — it has made hundreds of acquisitions since the early 1980s and sold off a lot too. Last week, though, it seemed to take things to a new level. Danaher said that it will be splitting into a “science and technology growth company,” which will keep the Danaher name, and a “diversified industrial growth company,” which won’t. It also announced the $13.8 billion acquisition of Pall Corp., a maker of filtration and purification systems that will be part of the science-and-technology Danaher, and the beginning of an exchange offer in which Danaher spins off to shareholders its stake in NetScout Systems, with which it recently merged its communications-equipment business.

Posted by on May 20th, 2015 at 11:01 am


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