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Australia's largest pathology company Sonic Healthcare (ASX: SHL) is on an acquisition streak in Europe, striking a deal to buy SYNLAB Suisse for CHF150 million ($250 million) after a busy April when it purchased two German companies for a combined €370 million ($602 million).
The acquisition of SYNLAB Suisse, the Swiss laboratory network of SYNLAB Group, is expected to generate annual revenues of CHF100 million ($166 million) with 600 staff across 19 labs, but has been deemed immaterial by the broader Sonic Healthcare group.
Sonic also described the two German acquisitions in April as not material, and the now completed takeover of formerly ASX-listed Vita Group by a Sonic Healthcare affiliate was not reported by the group to the market.
SHL shares rose 2.28 per cent today to $35.50 on the news, and are up 20 per cent since the start of 2023.
The purchase price will be funded in Swiss francs from Sonic's existing cash and debt facilities, and is expected to be earnings per share accretive from the 2024 calendar year with a return on invested capital (ROIC) exceeding the cost within two years of the acquisition.
Swiss merger control clearance has been obtained and the transaction is expected to close on 3 July 2023.
"The partnership with SYNLAB Suisse is an important step for Sonic as it significantly expands our presence in Switzerland," says Sonic CEO Dr Colin Goldschmidt.
"I take this opportunity to warmly welcome the pathologists and staff of SYNLAB Suisse into our Swiss and worldwide team of colleagues at Sonic Healthcare and we look forward to working together with this highly experienced and respected team.
"The combination with SYNLAB Suisse across all three Swiss language regions will serve to enhance and strengthen our service offering to clinicians and their patients."
Sonic Healthcare's Swiss subsidiary is already the largest provider of laboratory medicine in the country, comprising more than 15 comprehensive and specialist medical laboratories operated by Medica, headquartered in Zurich, and Medisupport which has its headquarters in Lucerne.
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