PRINCETON, NJ – February 4, 2014 – On January 31, 2014, Covance, Inc. sold its high-complexity genomics laboratory, located in Seattle, Washington, to Laboratory Corporation of America Holdings, and entered into a five year services agreement, pursuant to which Covance will collaborate with LabCorp to continue to offer these services to its clients. Covance expects to report a small gain on this sale in its first quarter ending March 31, 2014, which will be excluded from its pro forma earnings per share. Covance will continue to provide other genomics services to its clients through its Central Laboratories business unit.
Joe Herring, Chairman & CEO of Covance, remarked during the company’s Q4 2013 earnings call, “our laboratory leadership team continually reviews and creates development solutions that combine both internal and external testing resources to meet the evolving needs of our clients. As part of this process, we concluded from a strategic perspective that we can enhance our genomic services offering by collaborating with an external partner who had access to a broader healthcare client base. This should enable more rapid growth for the business, increase profitability and allow further investment in new capabilities. We’re excited to partner with LabCorp to offer these important services to our clients through a long-term relationship.”
Fairmount Partners represented Covance as its exclusive financial advisor in arranging the sale of the Genomics Laboratory to LabCorp, and structuring the accompanying five-year services agreement.
About Covance Inc. (NYSE:CVD)
Covance Inc., a drug development services company, provides various early-stage and late-stage product development services primarily to the pharmaceutical, biotechnology and medical device industries primarily in the United States and Europe. Its Early Development segment offers preclinical services, such as toxicology; pharmaceutical and nutritional chemistry, and food safety; purpose-bred animals for biomedical research; immunology, and polyclonal and monoclonal antibody; metabolism studies and pharmacokinetic screening; and bioanalytical testing services. The company also provides laboratory testing services to the chemical, agrochemical, and food industries. Covance Inc. was founded in 1987 and is headquartered in Princeton, New Jersey. www.covance.com
About The Covance Genomics Laboratory
The Covance Genomics Laboratory (CGL) possesses a history of innovation, unrivaled experience and expertise and broad technology capabilities including Affymetrix and Agilent RNA expression platforms, Genome Wide Association Study capabilities utilizing both Illumina and Affymetrix, custom multiplex genotyping with Illumina Bead Array technology and next-generation DNA sequencing with the Illumina Genome Analyzer. CGL’s optimized and automated processes provide capacity to meet the entire spectrum of genomic needs for multiple clients.
About Laboratory Corp. of America Holdings (NYSE:LH)
LabCorp is an American S&P 500 company headquartered in Burlington, North Carolina. It operates one of the largest clinical laboratory networks in the world, with a United States network of 36 primary laboratories. Before a merger with National Health Laboratory in 1995, the company operated under the name Roche BioMedical. LabCorp performs its largest volume of specialty testing at its Center for Esoteric Testing in Burlington, North Carolina, where the company is headquartered. www.labcorp.com
About Fairmount Partners
Fairmount Partners is one of the largest investment banking groups in the Mid-Atlantic region. The firm specializes in advising middle-market growth companies with mergers and acquisitions, capital raising and strategic advice. Fairmount offers deep expertise in the Healthcare Services and Technology, Information Technology Services, Technology and Software and Industrial and Consumer Products markets. Fairmount has completed more than 140 transactions throughout North and South America, Europe, Asia and Australia since its inception in June 2003. For more information, visit: www.fairmountpartners.com
Principals of Fairmount Partners acted as advisors to Covance in this transaction.