Australia’s Sonic Healthcare Buys PE-backed CBLPath

Australian medical diagnostics company Sonic Healthcare will buy private equity-backed CBLPath for an undisclosed amount. Stamford, Conn.-based private equity shop Galen Partners, which focuses on healthcare investments, owns more than 40% of CBLPath. The remainder of the company is held by management, staff and other private investors. The deal is expected to close before the end of the year. CBLPath is a national laboratory providing pathology services, and is based in Rye Brook, N.Y.

CBLPath today announced that it has reached an agreement to be acquired by Sonic Healthcare Limited (“Sonic”).

For the past seven years, CBLPath has been recognized as one of the fastest growing anatomic pathology reference laboratories in the nation. Building upon its strong presence in the Northeast, CBLPath has expanded; offering its services across the USA.

CBLPath will work closely with Sonic’s clinical laboratory divisions to cross sell services to their respective referrer bases. Significant revenue synergies are expected to be realized from the cross sell opportunities in FY2012 and following years. In addition, there are a number of cost synergies which Sonic can offer CBLPath, particularly in the areas of logistics, purchasing and billing.

The CBLPath management team and structure will remain unchanged following the transaction. CBLPath’s senior management and pathologists have extensive industry experience and have demonstrated an exceptional ability to grow the business.

“CBLPath has always prided itself on our passion for the work we do, and the quality results we provide to our clients,” said David W. Bryant, Chairman of the Board and President of CBLPath. “We recognize the same in Sonic Healthcare and are looking forward to being able to pool our resources for the benefit of our mutual clients.”

Completion of the transaction is expected in December 2010 and is conditional upon CBLPath shareholder approval and anti-trust clearance. Over 40% of CBLPath is currently owned by Galen Partners, a leading healthcare private equity firm, who provided growth capital in 2005, with the balance owned by management, staff and other private investors.

“Since our founding in 1990, Galen Partners has a distinguished track record of collaborating with entrepreneurs in healthcare growth equity investments to build businesses and create significant value for all shareholders,” said David Jahns, Managing Director, Galen Partners. “We very much value the opportunity to have partnered with the CBLPath management team by providing collaborative capital to support their vision of building a leading anatomic pathology lab by delivering exceptional client service. Joining the Sonic federation of laboratories is the next phase of their growth and continued success.”

Lazard Middle Market LLC served as financial advisor to CBLPath in this transaction.

About CBLPath

CBLPath is a national specialty lab offering a full convergence of anatomic, molecular and digital pathology services. The company provides a one-stop solution for comprehensive sub-specialized diagnostics, and timely, accurate, patient-centered disease management guidance. Through its Best Practice ™ Partnership Program, CBLPath partners with pathologists to help them grow their practices, while giving them the ability to stay independent and “keep medicine local.” The company also provides sub-specialty physicians access to comprehensive, high-quality testing in their local market. Founded in 1988, CBLPath established a reputation for providing timely, highly accurate diagnoses along with extraordinary customer service and a true patient-centered commitment. For more about the company, please visit

About Sonic Healthcare Limited

Sonic Healthcare is one of the world’s largest medical diagnostics companies, providing laboratory and radiology services to medical practitioners, hospitals, community health services, and their collective patients. Sonic Healthcare Limited is the parent company of the many operating companies around the world comprising the Sonic Healthcare group. It is a public company, listed on the Australian Securities Exchange (ASX), where it is classified as one of Australia’s “Top 100” companies. Sonic Healthcare has its head office at Macquarie Park in Sydney, Australia, in the same building as the main Douglass Hanly Moir Pathology laboratory. In the medical arena, their success is based on the fact that Sonic Healthcare companies are recognized as quality diagnostic practices that have remained true to the ethical principles of the medical profession. For more about the company, please visit

About Galen

Galen Partners is a leading health care private equity investment firm based in Stamford, Conn. The firm focuses on growth equity investments in health care technology-enabled services, medical devices, and specialty pharmaceutical companies. With nearly $1 billion under management raised through five funds, Galen has invested in more than 70 companies since 1990. Some of Galen Partner’s notable investments include Chamberlin-Edmonds Associates, EduNeering, MedAssets, Medicode, MiniMed, and Pyxis. The firm continues a tradition of strategic collaboration and partnership with its portfolio company management teams to build health care market leaders. For more information, please visit Galen’s Web site at

About Lazard Middle Market

Lazard Middle Market LLC, a subsidiary of Lazard Ltd, provides advice on M&A, restructuring, and capital raising to the middle market. Our senior professionals focus exclusively on mid-cap companies, bringing to bear all the industry expertise, senior board-level relationships, and local perspectives of Lazard’s bankers in 41 cities across 26 countries in North America, Europe, Asia, Australia, Central and South America. For more information about Lazard Middle Market, please visit