
European Reference Laboratory SYNLAB Enters Investment Agreement with Private Equity Firm Cinven for Public Acquisition Offer
SYNLAB, a leader in medical diagnostic services and specialty testing in Europe, has entered into an investment agreement with Cinven-backed entity Ephios Luxembourg S.à r.l. The agreement entails a public acquisition offer (the “Offer”) for all outstanding SYNLAB shares at €10.00 per share in cash. Cinven, which already owns around 43% of SYNLAB’s shares, is the driving force behind the Offer.
SYNLAB is a leading laboratory diagnostic services provider in Europe and around the globe with over 30,000 employees in 33 countries across 4 continents. Synlab’s customers include over 700 hospitals, countless medical practitioners, and tens of millions of patients.
The proposed offer price represents a premium of approximately 42% over SYNLAB’s XETRA closing share price on March 10, 2023, which was the last trading day before SYNLAB’s regulatory announcement regarding Cinven’s non-binding expression of interest. In comparison to the volume-weighted average share price over the three months leading up to SYNLAB’s announcement of Cinven’s interest, the premium stands at approximately 13%. The deal values SYNLAB at a valuation of 4.6x on a EV/2022 adjusted EBITDA basis, however the company’s sales and profitability have been declining of late due primarily due to declining COVID-19 testing revenue with the COVID-19 pandemic ending.
SYNLAB’s Management Board and Supervisory Board acknowledge that the Offer could be an attractive exit opportunity for short-term or risk-averse investors, they believe the offer price does not adequately reflect the company’s long-term strategic value. The Management Board and Supervisory Board will provide a reasoned statement on the adequacy of the Offer after reviewing the offer document following its publication.
Cinven has secured support from major shareholders Novo Holdings and Ontario Teachers’ Pension Plan Board to sell their shares in the Offer. Dr. Bartholomäus Wimmer, the SYNLAB founder, has agreed to sell 60% of his shares in the Offer and Qatar Holding LLC, a subsidiary of the Qatar Investment Authority, has also committed to reinvest all its shares alongside Cinven.