Labco: formal bids expected next month

Greg Gille
08 April 2013

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3i-backed medical diagnostics company Labco formally launched its sale process at the end of January and first bids are expected in May.

Four candidates are lining up to acquire the asset, including two private equity players and two corporates, according to French publication Capital Finance. The bids could value Labco at up to €1.1bn, which could finally put an end to the dry spell experienced by France at the upper end of the market for the past few months.

3i was reported to have hired Rothschild in the summer of 2012 to advise on a potential sale of the business. Labco – in which 3i holds a 20% stake alongside an investor consortium including TCR Capital, Natixis Investment Partners, Omnes Capital and CIC Finance – was at the time believed to have attracted interest from private equity firms EQT, Bain Capital and TowerBrook Capital Partners. PAI partners and Blackstone were also touted as potential buyers in the following months.

3i invested €140m in medical diagnostics company Labco as part of a €200m round in 2008, together with TCR Capital, Nixen Partners and CM-CIC Capital Finance, which provided the additional €60m.

Labco made a €100m bond issue in February to repay the outstanding amounts borrowed under its revolving credit facility. The company had already raised €500m on the high-yield market in early 2011.

Labco was founded in 2003 and provides diagnostics services to general practitioners, hospitals and patients. The group includes more than 170 laboratories and is understood to have generated a €600m turnover with €122m EBITDA in 2012.

3i declined to comment.