FRANKFURT (Reuters) - German laboratory services group Synlab is pushing ahead with preparations for a planned stock market listing next year and has drafted banks to organise the deal, people close to the matter said.
The company, owned by private equity group Cinven, has mandated Goldman Sachs GS.N and JP Morgan JPM.N as global coordinators of the initial public offering, which could value Synlab at 5 to 6 billion euros ($5.9-$7.1 billion).
Cinven and some of the banks declined to comment while others and Synlab were not immediately available for comment.
Cinven bought Synlab for 1.7 billion euros from buyout firm BC Partners in 2015 and then merged it with France-based Labco, creating Europe’s largest lab services provider handling about 500 million tests a year.
Although European lab operators, providing standard blood and urine tests as well as other medical and veterinary diagnostic services, have been consolidating to cut costs, the industry remains fragmented as reimbursement rules differ across the European Union.
Synlab last year reported adjusted earnings before interest, tax, depreciation and amortization of 444 million euros on revenues of 2.1 billion euros.
In the first half of 2020, Synlab’s net loss widened to 12 million euros from 2 million euros in the year-earlier period as fewer patients visited their doctors to undergo standard tests.
It also faced significant costs to expand its coronavirus testing capacity and has struck deals with various European countries to ramp up testing. Earlier this week, it announced such a deal with the Netherlands.
Ratings agency Moody’s in May changed its outlook for Synlab’s debt to negative, citing the negative impact of operational disruptions triggered by the coronavirus outbreak.
Additional reporting by Clara Denina; Editing by Douglas Busvine and Emelia Sithole-Matarise
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