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X-Rite To Be Acquired By Danaher For $5.55 A Share

KENTWOOD -- Michigan is losing another corporate headquarters, as Kentwood-based X-Rite Inc. (Nasdaq: XRIT) announced Tuesday it would be acquired for $5.55 a share, or $525 million, by Washington, D.C.-based Danaher.

Danaher (NYSE: DHR) is an old-fashioned conglomerate, starting in 1969 as a real estate investment trust but branching into corporate acquisitions 15 years later. The company has made more than 400 acquisitions since 1984. Danaher was one of the first North American companies to use the principles of kaizen, the Japanese word for continuous improvement.

The acquisition is good news for X-Rite shareholders, since the purchase price represents a 39 percent premium over X-Rite's closing share price of $4 at the close of trading on Monday, April 9.

X-Rite said the transaction had been approved unanimously by its board of directors, and announced that stockholders representing approximately 68 percent of the voting power of X-Rite's outstanding shares intend to tender their shares into the offer.

"Joining Danaher enhances X-Rite's ability to achieve our growth goals while realizing a significant and immediate all-cash premium for X-Rite stockholders," said X-Rite CEO Thomas J. Vacchiano Jr. "Danaher's global scale, market presence and resources will allow X-Rite to accelerate our growth, particularly for our key strategic initiatives like PantoneLIVE and Appearance solutions. As part of Danaher, X-Rite will be able to expand our access to new markets and complementary technologies."

Danaher and X-Rite said that after the transaction, X-Rite will operate as a stand-alone company within Danaher's Product Identification group, which is a part of their Industrial Technology Segment. X-Rite's existing management team will continue to hold key senior leadership positions at the company following the close of the transaction. X-Rite will continue to do business under its existing X-Rite, Pantone and other leading brands.

"Our commitment to our customers, employees, partners and local communities remains unchanged," Vacchiano said. "We expect X-Rite customers and employees to benefit from our being part of a larger, stronger company focused on growth and innovation and which shares our passion for retaining, developing and recruiting the best talent available."

Danaher said the transaction is expected to close by June 30.

X-Rite develops, manufactures, markets and supports color measurement systems, software, color standards and services. X-Rite serves a range of industries, including printing, packaging, photography, graphic design, video, automotive, paints, plastics, textiles, dental and medical.

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The proposed buyout is already prompting rumblings from law firms that investigate such things. Dallas-based Powers Taylor LLP and former Securities and Exchange Commission attorney Willie Briscoe both said they are "investigating" the sale.

"Based on the lack of a significant premium to X-Rite shareholders, and other factors, the firms are investigating whether the buyout price is fair to X-Rite shareholders," Briscoe and the firm said in a joint statement. "Our proposed shareholder lawsuit seeks to obtain additional value for shareholders than what is proposed in the current buyout offer."

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