Quest Diagnostics has signed a definitive agreement to acquire Canada-based laboratory tests provider LifeLabs from pension fund company OMERS, in a deal valued at approximately C$1.35bn ($985m), including net debt.
The acquisition will see LifeLabs retain its Canadian headquarters, brand, and management team while benefiting from Quest's expertise and resources.
Quest aims to bolster LifeLabs' services with new technologies and resources.
The company also expects to help accelerate the data security enhancements of LifeLabs.
LifeLabs president and CEO Charles Brown said: “Quest is the right partner to build on the strengths of LifeLabs and align with our strategic path, which focuses on enhancing the accessibility and quality of services that we provide to millions of Canadians.
“Together, we'll grow LifeLabs and provide more Canadians with access to the advanced diagnostics they rely on, closer to home. We sincerely thank OMERS for its investment, leadership, and valued collaboration over 17 years.”
The acquisition of LifeLabs's equity is strategically aligned with Quest's growth objectives, with the deal expected to generate around C$970m ($710m) in annual revenues.
Subject to customary closing conditions and Canadian regulatory approvals, the transaction is planned to be completed at the end of this year.
McCarthy Tétrault provided legal advisory services to Quest Diagnostics while OMERS was advised by Blake, Cassels & Graydon.
Evercore and CIBC Capital Markets acted as financial advisers to OMERS.
OMERS Infrastructure global head and executive vice-president Michael Hill said: “Our purchase in 2007 and subsequent investments have helped LifeLabs grow into a great Canadian success story.
“Quest is uniquely equipped to expand the service offering at LifeLabs, bringing innovations to this market while extending access for patients in Canada.”
Over the past five years, LifeLabs has been part of the Quest-led Global Diagnostic Network, which links 12 diagnostic labs worldwide.
LifeLabs and Quest also collaborate, with Quest providing access to specialised diagnostic tests.
Last year, Quest Diagnostics and Universal DX signed a commercial agreement for an advanced colorectal cancer screening blood test in the US.
