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Synlab targets a $ 6 billion market cap in the Frankfurt IPO as its COVID-19 test explodes


Synlab has set the price range for its planned Frankfurt public launch at € 18 to € 23 per share, giving Europe’s largest lab service provider a market cap. up to € 5 billion ($ 6 billion) as it looks like a big profit. its need for COVID-19 testing capabilities.

Munich-based Synlab said in one declare on Monday they will offer up to 71.5 million ordinary shares, resulting in the total size of the IPO up to 1.48 billion euros.

The company aims to raise 400 million euros during the IPO, the proceeds will be used to repay debt. Current shareholders, including private equity group Cinven, Danish investor Novo Holdings and Canadian pension fund Teacher’s Pension Plan Board, will also sell off their stakes.

Read: Over-the-counter 15-minute COVID-19 tests will arrive at a store near you – and here are their prices

Cinven bought Synlab for 1.7 billion euros from the group that acquired rival BC Partners in 2015 and later merge it with France-based Labco to establish Europe’s largest laboratory services company, handling about 500 million tests a year for 100 million patients.

Synlab CEO Mathieu Floreani said the current COVID-19 pandemic highlights the importance of medical diagnostic services. “It also demonstrates how Synlab can rapidly adopt both medical leadership and operate based on our position as a European market leader with a unique international footprint and develope.

The company says it has conducted 11.6 million polymerase chain reaction (PCR) tests for COVID-19 in 2020. Governments, including the UK, have already conducted mandatory PCR testing. for international travel as countries begin to relax lock-on restrictions.

Synlab plans to continue its growth through acquisitions, consolidating the “very fragmented” European medical diagnostics market. The company spends 200 million euros on mergers and acquisitions each year.

Read: British biotechnology Oxford Nanopore prepares for a $ 3 billion IPO in London

High demand for a coronavirus trial has helped increase Synlab’s revenue by 38% by 2020 to more than € 2.6 billion, while revised earnings increased 71% to € 679 million. The company is expected to achieve revenue of more than 3 billion euros by 2021. The group is targeting a dividend payout ratio of 20% to 30% of the previous year’s adjusted net profit, with a first dividend is expected to be paid in 2022.

Goldman Sachs
GS,
+ 1.11%

and JPMorgan Chase & Co.
JPM,
+ 0.74%

is acting as the general global coordinator for IPO. Securities BofA
BAC,
+ 1.06%
,
Deutsche bank
DB,
+ 2.12%
,
Barclays
BARC,
-0.98%
,
BNP Paribas
BNP,
-0.87%
,
HSBC Bank
HSBC,
+ 1.09%
,
Jefferies
JEF,
+ 2.04%

and UniCredit
UCG,
+ 0.85%

are general book players. Crédit Agricole and Natixis
KN,
+ 0.02%

are leading co-managers. Lilja & Co. is an independent advisor to Synlab and its shareholders.

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