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Cinven to acquire Labco in EUR1.2bn deal

European private equity firm Cinven is to acquire Labco, one of the largest European operators of medical diagnostic laboratories, from a consortium of investors, for an enterprise value of EUR1.2 billion.   

Labco, headquartered in France, operates in France, Spain, Italy, Portugal, Belgium and the UK and conducts clinical tests; delivers results to prescribing doctors and patients; and provides assistance with the interpretation of clinical results through in-house laboratory doctors. Labco also operates a large portfolio of hospital outsourcing contracts in Europe, providing services to both ambulatory care and hospitals. 
 
Established in 2003, Labco operates a network of more than 160 routine and specialist laboratories and over 1,000 collection centres across seven European countries. In the year to 31 December 2014, the Group generated pro forma revenues of circa EUR650 million. It employs more than 6,000 employees and medical personnel, who conduct over 150 million tests each year on circa 20 million patients.

The clinical diagnostic sector in the EU is worth more than EUR75 billion, with the clinical laboratory segment representing approximately 33 per cent of the European diagnostics sector. Clinical laboratory expenditure currently only accounts for circa 1 per cent of the overall healthcare costs with significant drivers for growth. Prediction, prevention and diagnosis spending is expected to grow from approximately 20% of healthcare spend today to circa 30 per cent by 2020.
 
Stuart McAlpine, Partner at Cinven, says: "The combination of Cinven’s European network in France, Spain and Italy, where Labco operates, together with its longstanding healthcare sector knowledge has enabled us to originate, evaluate and execute this exciting opportunity. Cinven’s investment in Labco builds on its already strong positions in both the healthcare sector, particularly in in-vitro diagnostics following its highly successful (and now realised) investments in Phadia and Sebia, and the French market."
 

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