Agilent Technologies, Inc., the Santa Clara-based electronic and bio-analytical measurement company, will acquire the Palo Alto-based Varian, Inc., for $1.5 billion.

The transaction will broaden Agilent's applications offerings in the life sciences, environmental and energy markets, according to Eric Endicott, public relations manager of the Agilent life sciences and chemical analysis division.

Varian is a leading supplier of scientific instruments for life-science and industrial markets.

"The transaction will propel our growth for the future," Endicott said. "The capabilities that Varian brings are complementary to our own. They have a strong consumables portfolio and 3,600 employees that will be a significant addition not only on the portfolio side but also on the people side."

Acquiring Varian will also expand Agilent's product portfolio to include atomic and molecular spectroscopy and will initiate its entry into nuclear magnetic resonance, imaging and vacuum technology markets, he said. Agilent has about 19,000 employees, according to its website. Agilent initially was a spinoff from Hewlett Packard Corporation and was formerly based in Palo Alto.

"This acquisition is a major step in Agilent's transformation into a leading bio-analytical measurement company," Bill Sullivan, president and CEO of Agilent, said.

"While we continue to be a world leader in electronic measurement, our biggest opportunities for future growth are in bio-analytical measurement. The combination of Varian with Agilent's bio-analytical measurement business will result in the broadest product offering in the industry."

Agilent will pay $52 in cash per share of common stock for Varian. The transaction represents a premium of 35 percent to Varian's closing price on Friday, July 24.

The transaction, expected to create $75 million in annual cost synergies and to meet Agilent's goal of 20 percent return on invested capital within four to five years, remains subject to approval by Varian's shareholders.

"We are now starting to go through the regulatory approval process which could take 60 plus days to complete," Endicott said. "We have four to five months to close the deal before the end of the calendar year."