Eurofins announces the successful closing of the acquisition of Covance Food Solutions
Eurofins Scientific (EUFI.PA), a global scientific leader in bioanalytical testing, announces the successful closing of the transaction to acquire Covance Food Solutions from LabCorp (LH: NYSE), a leading global life sciences company. Covance Food Solutions provides product integrity, food safety, product development and consulting solutions for end-use segments that span the life cycle of food, beverage and dietary supplement products.
Covance Food Solutions operates an integrated network of 12 facilities across the globe (9 in the U.S., 2 in the UK and 1 in Singapore). It employs approximately 850 staff and expects to generate revenues of approximately US$160m in 2018, with an EBITDA margin well in excess of Eurofins’ objectives. The acquisition price is US$670m on a cash free debt free basis. This price includes the significant favorable tax benefits of an acquisition of assets in the USA. As Eurofins and Covance Food Solutions have a complementary geographic footprint and service offering, no restructuring of either business is foreseen. Covance Food Solutions will be consolidated in Eurofins’ accounts from August 1st 2018 and should be immediately margin and EPS accretive.
This acquisition significantly strengthens Eurofins’ food testing offering in the U.S., which is the largest food testing market in the world. Covance Food Solutions provides Eurofins the scale and scientific depth in the U.S. that it enjoys in Europe and brings its long-standing relationships with many of the largest U.S. food and beverage multinational corporations to the Eurofins Group. These clients will gain access to the unmatched technological portfolio and international network of Eurofins’ food testing laboratories worldwide. Synergetic top line growth effects are thus expected from cross selling to each organization’s clients which should contribute to creating sustainable shareholder value in the long-term.
Comment from Dr. Gilles Martin, Eurofins CEO: “We are extremely pleased to welcome Covance Food Solutions and its talented team to the Eurofins Group. Covance Food Solutions has been one of the pioneers in food testing in the U.S. and, like Eurofins, has continuously focused on innovation and offering the highest quality testing services in the industry. The opportunity to acquire such high-quality assets occur very rarely in the food testing industry. This unique transaction represents a clear milestone for Eurofins towards its 2020 objectives to build an unprecedented global, one of a kind testing platform with world class infrastructure, science and IT solutions.”
For more information, please visit www.eurofins.com or contact:
Phone: +32 2 766 1620
Notes for the editor:
Eurofins – a global leader in bio-analysis
Eurofins Scientific through its subsidiaries (hereinafter sometimes “Eurofins” or “the Group”) believes it is a scientific leader in food, environment and pharmaceutical products testing and in agroscience CRO services. It is also one of the independent market leaders in certain testing and laboratory services for genomics, discovery pharmacology, forensics, CDMO, advanced material sciences and for supporting clinical studies. In addition, Eurofins is one of the emerging players in specialty clinical diagnostic testing in Europe and the USA. With over 38,000 staff in more than 400 laboratories across 44 countries, Eurofins offers a portfolio of over 150,000 analytical methods for evaluating the safety, identity, composition, authenticity, origin and purity of biological substances and products, as well as for innovative clinical diagnostic. The Group objective is to provide its customers with high-quality services, accurate results on time and expert advice by its highly qualified staff.
Eurofins is committed to pursuing its dynamic growth strategy by expanding both its technology portfolio and its geographic reach. Through R&D and acquisitions, the Group draws on the latest developments in the field of biotechnology and analytical chemistry to offer its clients unique analytical solutions and the most comprehensive range of testing methods.
As one of the most innovative and quality oriented international players in its industry, Eurofins is ideally positioned to support its clients’ increasingly stringent quality and safety standards and the expanding demands of regulatory authorities around the world.
The shares of Eurofins Scientific are listed on the Euronext Paris Stock Exchange (ISIN FR0000038259, Reuters EUFI.PA, Bloomberg ERF FP).
This press release contains forward-looking statements and estimates that involve risks and uncertainties. The forward-looking statements and estimates contained herein represent the judgment of Eurofins Scientific’s management as of the date of this release. These forward-looking statements are not guarantees for future performance, and the forward-looking events discussed in this release may not occur. Eurofins Scientific disclaims any intent or obligation to update any of these forward-looking statements and estimates. All statements and estimates are made based on the information available to the Company’s management as of the date of publication, but no guarantee can be made as to their validity.
Published: 1 August 2018