Swiss inspection, verification, testing and certification company SGS is to acquire the analytics and services unit of Synlab for €550m (US$650.3m) ahead of the German laboratory services group’s planned initial public offering.
The unit is a leading European provider for environment, food, hygiene, pharma and products analysis and testing. Last year, it generated had revenues of more than €200m and had approximately 2,000 employees.
“By joining forces with SGS, new growth opportunities are opening up,” said Sytze Voulon, chief executive of the analytics and services unit. “As part of the market leader in the fields of inspection, verification, testing and certification, we will be able to leverage existing resources and further strengthen our business.”
The transaction is subject to customary regulatory approvals and the deal is expected to close early in the first quarter of next year.
The sale comes as plans for Synlab’s own IPO move up a gear.
In mid-October, it hired Goldman Sachs and JP Morgan as global coordinators of the IPO. This could value Synlab as much as €6bn.
Based in Munich, Synlab Group is an international medical diagnostics provider with laboratory services for human and veterinary medicine as well as environmental analysis. The company emerged from the combination of the two medical diagnostics providers Labco and Synlab in 2015 by European private equity firm Cinven.