Laboratory News

Sonic Healthcare Acquires Two More Labs in U.S., Expands in Europe

Continuing its aggressive push into the U.S. market for clinical laboratory services, Sonic Healthcare Limited, of Sydney, Australia, announced two more laboratory acquisition in the United States last week, with a total investment of $33 million. One strengthens its presence in New York and the other boosts its operations in Nashville, Tennessee.

In the New York metropolitan area, Sonic Healthcare closed on its purchase of American Clinical Services, Inc.  (ACS), in Lyndhurst, New Jersey. ACS has current annual revenue of over $13 million. Founder and President James Hutchinson will continue to lead ACS, which will become part of Sonic's existing New York-based business, Sunrise Medical Laboratories, in Hauppauge, New York (on Long Island).

Sonic Healthcare noted that this acquisition gives it added presence in the New York market in both Long Island (to the east of New York City) and in New Jersey (to the south and west). "We would transfer some of the laboratory services from ACS into Sunrise and rationalize the courier and collection services," explained Sonic's Corporate Secretary Paul Alexander. "New York is a key and high-growth market in the United States. The market is growing at the high double-digit each year."

Prior to the end of 2007, Sonic Healthcare also purchased Woodbury Clinical Laboratory in Lebanon, Tennessee, a suburb of Nashville. WCL was founded in 1988 and has annual revenue of over $4 Million.  This acquisition gives Sonic Healthcare a presence in the Nashville Metropolitan market. When it acquired American Esoteric Laboratories (AEL) in 2006, AEL operated a laboratory in east Tennessee.

These latest lab acquisitions have brought Sonic Healthcare's total investment in the United to almost $500 million since 2005. Alexander noted that the company's operations in the United States now represent about 20% of its total global revenue.

Also last week, announced that it had completed the purchase of 100% ownership of a German company, Schottdorf Group.  In 2004, Sonic acquired a 55.9% interest in Schottdorf. It has now purchased the remaining interest for $133 million (in U.S. dollars). Pathologists and lab directors will be interested to learn that Schottdorf Group operates one of the world's largest clinical laboratory facilities. Located in Augsburg, Germany, its laboratory services approximately 60,000 patients per night.

Since entering the United States in 2005, Sonic Healthcare has done a steady stream of laboratory acquisitions. Here's a list of its lab acquisitions in this country:

• Clinical Pathology Labs of Austin, Texas, in August 2005, (82% share for $180 million)
• American Esoteric Laboratories (recently moved to Austin, Texas), in January 2006, for $100 million
• Muskogee Clinical Laboratory, in Muskogee, Oklahoma, in April 2006, for about $10 to $20 million
• Cognoscenti Health Institute's Clinical Laboratory of Orlando, Florida, September 2006, for $15 million
• Lookadoo Skyline Laboratories, in Port St. Lucie, Florida, in December 2006, for about $10 million to $20 million.
• Clinical Pathology Labs of Austin, Texas, in January 2007, (the remaining 18% share)
• Mullins Pathology & Cytology in Augusta, Georgia, in April 2007, for $17 million
• Sunrise Medical Laboratories, Hauppauge, New York, in July 2007, for $168 million.
• American Clinical Services, Inc., Lyndhurst, New Jersey, in December 2007, for an estimated $26 million.
• Woodbury Clinical Laboratory, Lebanon, Tennessee, in December 2007, for an estimated $7 million.

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100% OWNERSHIP OF THE SCHOTTDORF GROUP