PAI’s ELITech Weighs Sale of Molecular Unit Amid Covid Boom

PAI Partners is considering a sale of ELITechGroup’s molecular diagnostics unit as the French maker of medical testing equipment sees a boom from the coronavirus pandemic, people with knowledge of the matter said.

The private equity firm is working with Jefferies Financial Group Inc. and an arm of Natixis SA as it starts gauging interest from potential buyers, the people said, asking not to be identified because the information is private. A sale could value the ELITech unit at more than 1 billion euros ($1.2 billion) based on initial estimates, the people said.

The molecular diagnostics unit could attract interest from competitors as well as private equity funds racing to invest in businesses targeting the coronavirus, the people said. PAI’s deliberations on a divestment of the molecular diagnostics business could eventually lead it to sell all of ELITech, according to the people.

No final decisions have been made, and details including the potential valuation could change, the people said. Representatives for PAI, Jefferies and Natixis declined to comment.

Any deal would add to the $52.5 billion in health-care transactions announced by European companies this year, according to data compiled by Bloomberg. Paris-based ELITech makes and distributes diagnostic products for clinical chemistry, microbiology, hematology and molecular biology.

In March, it announced the release of a new coronavirus testing kit, approved by European regulators, in collaboration with South Korea’s Osang Healthcare Co. The company’s virus test has also received emergency use authorization in the U.S. ELITech had delivered more than 700,000 Covid-19 tests worldwide, according to an April press release.

The molecular diagnostics business makes equipment that can detect a range of infections from respiratory pathogens to meningitis, sexually transmitted diseases and gastrointestinal viruses. PAI agreed to acquire ELITech from Ergon Capital Partners in 2017 in a deal valuing the company at 355 million euros, according to its website.

©2020 Bloomberg L.P.

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