Bridgepoint Buys Logistics Firm LGC

LONDON (Reuters) – Private equity firm Bridgepoint has bought forensics and scientific testing company LGC for 257 million pounds ($404 million), as private equity dealmaking comes back to life after a year in the doldrums.

LGC’s forensics division works with the police and other authorities, offering toxicology, drug and paternity testing and providing scientists to help investigators at crime scenes.

Mid-market buyout house Bridgepoint acquired the business from LGV Capital, the private equity unit of insurer Legal & General Group Plc (LGEN.L), it said on Friday.

London-based LGC, which employs 1,500 people in 28 laboratories in Europe, India, China and the United States, is forecasting revenues of 130 million pounds for the year to end-March 2010.

The company has grown at a compound annual growth rate of 18 percent over the last 10 years, Bridgepoint said.

In addition to forensics, it has three other divisions offering services including genetic and mass-spectrometry testing and providing reference materials for reference testing.

“LGC is strongly placed for further growth on the back of increasing regulation and the trend to outsourcing within both the public and private sectors,” said Bridgepoint partner Chris Busby in a statement.

The private equity firm has already identified acquisition targets to help the company build its position in the UK and internationally, a source familiar with the situation said.

Reuters reported in November that a number of prospective buyers, including private equity firms, were preparing bids for LGC. [ID:nGEE5AQ1AW]

Bridgepoint last week agreed the sale of pet goods chain Pets at Home to rival KKR for 955 million pounds, a deal that signalled the return of secondary buyouts — where one buyout house out buys a company from another. 

That deal earned Bridgepoint more than eight times its original equity investment.

HSBC and Rothschild advised Bridgepoint on its purchase of LGC, while KPMG advised LGV.

Bridgepoint arranged its own financing package for the deal with the existing syndicate of lenders, including HSBC, Lloyds, Bank of Ireland and Societe Generale, the source said.

(Editing by Dan Lalor and David Cowell)

($1=.6363 Pound)