MEDP - Quest Diagnostics to Expand in Canada With LifeLabs Buyout | Benzinga
Quest Diagnostics (NYSE: DGX) has entered into a definitive agreement with OMERS to acquire LifeLabs, a prominent Canadian provider of community laboratory tests. The deal, valued at approximately CAN $1.35 billion ($985 million), underscores DGX's strategy to expand its footprint in Canada's healthcare diagnostics market.
By integrating LifeLabs into its operations, Quest Diagnostics aims to enhance the accessibility and quality of diagnostic services for Canadians.
Investors should note that OMERS, a jointly sponsored, defined benefit pension plan, purchased LifeLabs back in 2007.
Terms and Strategic Vision
Under the latest agreement, Quest Diagnostics will acquire 100% of LifeLabs' equity, funding the transaction through cash and debt. The acquisition is expected to generate annual revenues of approximately CAN $970 million ($710 million) and will be slightly dilutive to Quest Diagnostics' GAAP EPS due to amortization. However, it will be accretive to adjusted EPS within the first year after closing.
LifeLabs will retain its brand, headquarters and management, ensuring continuity in its operations while benefiting from Quest's expertise and innovations.
Synergy Benefits
The acquisition promises several synergy benefits. Quest Diagnostics' extensive experience and resources will bolster LifeLabs' service offerings. This includes enhanced online appointment scheduling and quicker patient service center processing. Additionally, Quest Diagnostics plans to accelerate LifeLabs' data security measures, ensuring that Canadian patients' health data remains ...