USA— Enzo Biochem, Inc. has reached an agreement with Labcorp for the acquisition of Enzo Clinical Labs, the clinical laboratory division of Enzo Biochem.
The sale is part of Enzo’s “focused return” initiative aimed at maximizing shareholder value, which began in 2022.
Labcorp is undergoing a corporate shakeup to spin off its clinical trials business as a standalone company while acquiring Enzo Biochem’s clinical laboratory division for US$146 million in cash.
Enzo’s clinical lab provides testing services to physicians, medical centers, and pharmaceutical companies. The acquisition is the result of Enzo’s strategic review initiated last summer.
Enzo historically had three operating segments, with the clinical lab unit being the largest, accounting for US$74.4 million of its revenue in 2022.
However, clinical lab revenue decreased by 14.4% compared to 2021 due to declining testing demand. Enzo shifted its focus to the life sciences and clinical lab segments, discontinuing the therapeutics unit.
Bill Haas, Senior Vice President of Labcorp Diagnostic’s Northeast Division, acknowledged Enzo Clinical Labs’ reputation for high-quality testing and customer focus.
He expressed excitement about integrating these capabilities through a smooth and seamless transition of services, while maintaining a presence on Long Island with testing and service teams.
Haas believes that this investment will strengthen Labcorp’s commitment to the healthcare communities in the New York Tristate area and that Enzo Clinical Labs’ patients and providers will benefit from a combined experience that exceeds their laboratory needs.
Enzo Biochem restructured its operations in 2022 to target key areas and industry sectors with significant growth potential.
The company’s Enzo Life Sciences operating segment provides critical products and services used in drug discovery, development, and translational research applications.
Its global offerings include antibodies, genomic probes, assays, biochemicals, and proteins for the life sciences market.
The completion of the sale of Enzo Clinical Labs to Labcorp is subject to approval by Enzo’s shareholders with a termination fee of US$5 million payable to Labcorp if the deal is terminated, and the fulfillment of customary closing conditions for transactions of this nature.
These include the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
Once approved, Enzo will be better positioned to evaluate and execute further actions to increase shareholder value and advance its global leadership position in the life sciences sector.
Enzo Biochem’s strategic review to maximize shareholder value was advised by Jefferies, leading to the sale of its clinical lab’s division. Enzo will be left with only one reportable business segment: life sciences.
In the meantime, Labcorp is preparing to spin off its clinical trials business as a standalone company named “Fortrea”, with Tom Pike as its CEO.
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