Eurofins expands in Singapore and Turkey

Eurofins did not disclose the price of either deal. Picture: ©iStock

Eurofins Scientific has acquired two companies to boost testing services in Singapore and Turkey.

Mechem Laboratories is one of the reference laboratories in Singapore.

Eurofins said the deal would provide it with a strong entry platform in the local environment testing market.

Mechem will gain access to the infrastructure and capability of the group to allow expansion of services to domestic and international customers and accelerate market share expansion.     

Increased market share

The lab is accredited under FOSFA International (Federation of Oils, Seeds and Fats Associations).

Dr Gilles Martin, Eurofins CEO, said the acquisition demonstrates commitment to the Asia Pacific region.

“We are looking forward to contributing to strengthening Mechem’s market position, as well as expanding the portfolio of tests it offers by giving it access to the full range of services and capabilities of the Eurofins Group.”

With over 27,000 staff in 310 labs across 39 countries, Eurofins offers more than 130,000 analytical methods for evaluating the safety, identity, composition, authenticity, origin and purity of biological substances and products.

The second acquisition is of Gözlem Gýda Kontrol ve Araþtýrma Laboratuvarlarý (Gözlem), a food testing lab in Turkey.

The company employs 124 people and operates one large laboratory in Istanbul, as well as internal labs at 13 client sites in the Istanbul, Ankara and Izmir regions.

Eurofins said the deal gives it a strong platform to accelerate the roll-out of its capabilities for the food and beverage industry, which at almost 19% of GDP, is a key trading sector in Turkey.

Gözlem will use Eurofins’ network capabilities and tests portfolio to accelerate market share expansion and secure leadership in the fastest-growing regions of the country.

Martin said it will strengthen Gözlem’s market position by giving it access to services and capabilities of the Eurofins Group.

“The acquisition of Gözlem is another demonstration of our commitment to continuously reinforce our market leadership in the EMEA region.”

Eurofins’ lab opening mission

Meanwhile, Eurofins revealed it has averaged 20 start-ups launched per year since 2014.

The firm originally planned to open 35 green-field labs between 2014-17 but has now more than doubled that to 76 sites.

This would take total start-ups launched by the group to 110 labs between 2007 and 2017.

Laboratories from the last start-ups program (2010-13) reached break-even in 2014 and generated 22% revenue growth and 19% EBITDA margin in 2016.

Capital expenditures were related to the launch of 22 start-up labs during the year and the new generation of IT, said the company discussing 2016 full year results.

Martin said start-ups complement acquisition strategy and provide an alternative in markets or segments where acquisition prices are too high.

“Start-up investments therefore allow the group to enter or reinforce its leadership in high-growth markets without putting value creation at risk by overpaying for acquisition,” he said.

Operationally, we continue to make steady progress on key initiatives including the addition of 46,000m2 of laboratory surface in 2016 alone, development and commercialization of many tests to better serve our clients, internal development of tailor-made IT solutions…and the roll-out of over 20 new start-up laboratories in 2016.”

The food laboratory in Nantes gained the German QS accreditation to test for pesticides in fruits and vegetables, allowing the firm to partner with customers whose products are shipped in markets requiring such certification.

Eurofins added selection by Association Nationale expéditeurs/exportateurs fruits legumes (ANEEFEL) as one of the reference labs in France for the fruit and vegetable industry gives access to an important market.

In Asia Pacific, the group is on track to expand its main Chinese food testing lab in Suzhou, as well as the construction of labs in Australia and Singapore by the end of 2017.

The move of several small sites to a large campus in Hamburg is expected to be completed by 2019, as are site consolidation programs in Benelux and Sweden.

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