LONDON/FRANKFURT (Reuters) – BC Partners agreed to take control of two lab-testing companies and merge them into a group with annual sales of 380 million euros ($545.6 million) in one of Europe’s few sizeable private-equity buyouts this year.
Sources familiar with the matter said the deal gave the group an enterprise value of about 500 million euros and BC would own about two-thirds.
BC said it planned to make more acquisitions, and fund the group’s organic growth, to help consolidate the sector.
In a statement on Tuesday, BC said it would buy Vienna-based FutureLAB and take a 40 percent stake in Synlab, based in Augsburg, southern Germany. It aims to merge the two by the end of the year.
The pair analyse medical, veterinary and environmental samples. The new firm will be a market leader in Germany, Austria, Hungary, the Czech Republic, Switzerland and Slovakia, BC said.
BC funded about 70 percent of its purchase through equity, the sources said, implying it raised roughly 100 million euros of debt for the rest of its stake — illustrating how debt to fund buyouts remains constrained.
BC did not disclose financial details of the deal but said Raffeisen, UniCredit and WestLB provided bank finance.
The combined group’s largest minority shareholder will be Synlab Managing Director Bartl Wimmer, who will hold about 10 percent, one source said. FutureLAB Chief Executive Michael Havel has an option to acquire a stake in the new company. Other private equity firms have also invested in the sector, such as General Atlantic, owner of wagnerstibbe, which it says is one of Germany’s largest clinical lab groups.
In contrast to some of its peers, BC has continued to strike deals in recent months, investing $350 million in Office Depot Inc (ODP.N) in June, and agreeing to merge its UK boiler maker Baxi [BCPRTG.UL] with Dutch rival De Dietrich Remeha in July.
Tuesday’s deal means BC has now invested nearly 70 percent of its current, 5.9 billion euro fund, one source said.
By Quentin Webb and Philipp Halstrick
(Editing by Rupert Winchester)