Unquote

EQT's Cerba buys Lifebrain from Investindustrial

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EQT-backed Cerba HealthCare has agreed to acquire Italian laboratory diagnostics company Lifebrain from Investindustrial.

Closing is expected in Q4 2021 and is subject to customary antitrust approval.

On 20 July, Mergermarket reported that the sale was imminent, citing four sources familiar with the situation.

The parties agreed on a price of more than EUR 1bn, two sources said. Exclusivity was awarded last week to accelerate the signing, they added.

Investindustrial has backed the business since 2018, investing via the Investindustrial VI fund. At the time, Lifebrain generated annual revenues in excess of EUR 100m, with the figure now exceeding EUR 200m. The company also more than doubled its staff over the holding period, according to the vendor.

Lifebrain is expected to post EUR 100m in EBITDA for this year, compared with EUR 50m in 2019, as reported in the Italian press. The asset has been marketed based on 12x-15x its 2021 earnings, according to a recent press report, which also pointed to the high multiples applied to similar deals in the space such as the sale of Italian medical diagnostics group Bianalisi to private equity house Charme Capital Partners for more than EUR 400m, as reported by Mergermarket.

Lifebrain's auction kicked off in March. It attracted initial interest from France-based Groupe Inovie, controlled by PE firm Ardian; and from Biogroup, a French diagnostics service in which Intermediate Capital Group has a minority stake, as reported.

EQT entered exclusive negotiations to acquire France-based medical diagnostics business Cerba HealthCare from Partners Group last March. The deal valued the company at around €4.5bn. The firm is invested via EQT IX.

Founded in 1967 and headquartered in Saint-Ouen-l'Aumone, Cerba is a medical diagnostics business that assists pharmaceutical and biotechnology businesses with the development of new compounds and clinical trials. The company has 50 private and hospital laboratories globally and employs 9,600 staff.

Company
Founded in 2013 by Michael Havel and Bernhard Auer, Lifebrain is a clinical laboratory-testing business serving both the private and public sectors; it caters to both B2C customers (individual patients) and B2B clients (hospitals or other).

With more than EUR 200m in revenues, Lifebrain currently operates across approximately 360 laboratories and blood collection points in Italy, performing 27 million tests annually. It has more than 2,000 employees.

The company has notably been active in providing Covid-19 testing services to the Italian population; it also opened the third largest western European Covid-19 testing facility in Austria, according to a statement.

People
Investindustrial – Andrea Bonomi (chair).
Lifebrain – Michael Havel (CEO).
Cerba HealthCare – Catherine Courboillet (CEO).

Advisers
Vendor – Goldman Sachs (M&A); JP Morgan (M&A); Chiomenti (legal); Wolf Theiss (legal), PwC (financial due diligence); Boston Consulting Group (commercial due diligence); Deloitte (tax); Accenture (IT due diligence); Golder Associates (environmental due diligence).
Acquirer – Bank of America (M&A); EY (financial due diligence); Orrick (legal); Schoenherr (legal); Latham & Watkins (legal).

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