LabCorp Enters Definitive Agreement to Sell Covance Food Solutions to Eurofins
Transaction, worth $670 Million, reflects LabCorp’s mission to improve health, and Eurofins’ commitment to be a scientific leader in laboratory services for the food supply industry
LabCorp®, a global life sciences company, announced that it has entered into a definitive agreement under which Eurofins Scientific, a global group of laboratories active in food, environment and pharma product testing, will acquire the Covance Food Solutions business from LabCorp for an all-cash purchase price of $670 million. Covance Food Solutions is a global provider of innovative product design and product integrity services for end-user segments that span the global food supply chain, with an integrated network of facilities across the United States, United Kingdom and Singapore. For the twelve months ending December 31, 2017, Covance Food Solutions recorded pro-forma revenue of approximately $150 million.
Since LabCorp’s acquisition of Covance in 2015, Covance Food Solutions has increased its technical capabilities, broadened its geographic scope, and enriched its suite of customer-focused solutions for the global food, beverage, dietary supplement and agricultural industries. Covance Food Solutions is very complementary to Eurofins’ existing geographic presence and portfolio of services.
“Covance Food Solutions is a great business and has benefitted substantially from its ownership by Covance and then LabCorp,” said David P. King, chairman and chief executive officer of LabCorp. “Over the three years LabCorp has owned Covance, it has become clear that the greatest opportunities for us to create lasting value come from the core lab business, the Contract Research Organization, and the enterprise-wide combination that is beyond lab and beyond CRO. The sale of Covance Food Solutions to Eurofins allows us to focus on our core mission of improving health and improving lives, and at the same time better positions Covance Food Solutions to serve the global food supply industry.”
“Covance Food Solutions has a strong track record of success offering tailored testing and product design solutions for the food industry and enjoys outstanding credibility with its customers. This, combined with complementary service offerings and geographic footprint, made it an ideal fit with Eurofins’ existing offerings and supports our mission to deliver the most innovative and highest quality food testing and development services in the world,” said Eurofins’ chief executive officer, Gilles Martin.
The transaction is expected to close in the third quarter of 2018, subject to customary closing conditions and regulatory approvals, including the expiration or early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. Further terms of the transaction were not disclosed.
Wells Fargo Securities is serving as exclusive financial adviser to LabCorp. Hogan Lovells and Kelley Drye are serving as LabCorp’s legal counsel.