May 28, 2015 / 6:42 AM / 2 years ago

Buyout group Cinven to buy France's Labco for $1.3 billion

(Reuters) - European private equity firm Cinven said on Thursday it had agreed to buy French medical diagnostics provider Labco SA (LABCO.PA) for 1.2 billion euros (852 million pounds), marking the latest in a long line of recent healthcare deals.

The confirmation of the acquisition at an enterprise price of 1.2 billion euros follows reports by Reuters and the Financial Times on Wednesday that a deal was imminent.

It comes two weeks after Labco abandoned plans for a 545-million-euro initial public offering on Euronext Paris, citing “volatility across global financial markets”.

The company, which operates in France, Spain, Italy, Portugal, Belgium and Britain, had revenues of 650 million euros in 2014. It employs more than 6,000 staff, who conduct over 150 million clinical tests a year.

The group generated 2014 earnings before interest, taxation, depreciation and amortisation (EBITDA) of 131 million euros for an EBITDA margin of about 20 percent, according to a person familiar with the matter.

“Cinven’s investment in Labco builds on its already strong positions in both the healthcare sector, particularly in in-vitro diagnostics following its highly successful - and now realised - investments in Phadia and Sebia, and the French market,” said Cinven partner Stuart McAlpine.

The global healthcare sector has seen a record $240 billion of deals so far this year, up 68 percent on the year-ago period, according to Thomson Reuters data.

Additional reporting by Ben Hirschler; Editing by Leslie Adler and Pravin Char

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