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Mergers and Acquisitions

Date: 2011-02-24

Type of information: Company acquisition

Acquired company: Lancaster Laboratories (USA)

Acquiring company: Eurofins Scientific (France)

Amount: approximately $ 200 million

Terms:

Eurofins Scientific has signed a definitive agreement to acquire Lancaster Laboratories, from Thermo Fisher Scientific, for approximately $200m, subject to post-closing adjustments. Completion of the transaction is expected in the next 2-3 months and is subject to applicable regulatory approvals and customary closing conditions. Implied EV/EBITDA multiple is in-line with levels previously communicated for transactions of this size and Eurofins’ value-creation objectives. Given that Lancaster is already a single-site laboratory in the USA, no site consolidations or restructuring costs are foreseen as a result of this acquisition. Based on Lancaster’s historic profitability and budget for 2011, the transaction should be immediately margin and EPS accretive for Eurofins.

Details:

With approximately 1,100 employees in the USA and Ireland, Lancaster is the leading provider of pharmaceutical product testing services and cGMP Quality Control (QC) in North America. The company has generated sales of approximately $115m in 2010. With this bolt on acquisition, the Eurofins Group becomes the global leader in this very stable and recurring business and significantly enlarges its North American footprint. Eurofins Pharma Services encompasses several key areas. Eurofins/MWG Operon provides genomic services including custom and genomic DNA sequencing, oligonucleotide and gene synthesis, pharmacogenomics and a range of molecular biology services. Eurofins’ logistical network allows it to integrate these services into each phase of the pre-clinical and clinical studies. In the pre-clinical phase, Eurofins Pharma Services mainly encompass pharmacology, bioanalytical and pharmaceutical analysis, translational medicine and Phase I studies. In the clinical phase, Eurofins Pharma Services, through Eurofins Medinet, operates one of the industry’s leading global Central Laboratory Networks with wholly-owned facilities in the USA, the Netherlands, France, Singapore, China, and soon in India, all operating in an identical, harmonized manner. Eurofins’ comprehensive (bio)pharmaceutical product testing or cGMP Quality Control (QC) Services span the complete product development cycle from impurities analysis, stability studies, through to packaging and hygiene monitoring in North America and Europe.

Related:

Pharmaceutical product testing services and cGMP Quality Control

Is general: Yes