UAS Labs is being acquired from the private equity fund Lakeview Equity Partners, management team and other shareholders for US$530 million, net of tax assets. UAS Labs has 230 employees and is expected to generate revenues of around $85 million in 2020.
Chr Hansen said the acquisition will further strengthen and expand its global microbial platform and Human Health business, and aligns with the strategy of pursuing bolt-on acquisitions that fit into the microbial platform. The move comes hot on the heels of April's acquisition of Austria-based HSO Health Care GmbH for an undisclosed amount. HSO specializes in probiotics for women’s health.
“We are excited about the acquisition of UAS Labs and look forward to welcoming all its talented people, to join forces in our shared purpose – to develop and expand the global probiotics market, and we look forward to building upon the strengths of both companies,” said Mauricio Graber, CEO of Chr. Hansen.
“The two UAS Labs production facilities in the United States will increase our flexibility and capacity to produce, and also create a better balance in our geographical footprint. We believe that the UAS Labs acquisition will accelerate our efforts to grow our Health & Nutrition business globally, especially in the Asian markets.”
Highlights
UAS Labs was founded in 1979 with the initial focus on Lactobacillus acidophilus DDS-1. The company changed ownership in 2013 with Kevin Mehring (CEO) and Dr Greg Leyer (CSO) taking the reins.
In 2018, UAS Labs bought Nebraska Cultures and also completed a $60 million expansion of a fermentation facility in Madision, WI.
The company added important strains to its portfolio over recent years, including Lactobacillus reuteri NCIMB 30242 LRC (recently reclassified as Limosilactobacillus reuteri), Lactobacillus gasseri BNR17, and the ProDURA range of spore-forming probiotics. Earlier this year, UAS finalized a partnership with Lottus, LLC and Dr Pinaki Panigrahi, MD, PhD, for the Lactobacillus plantarum PPLP-217 strain (recently reclassified as Lactiplantibacillus plantarum).
In total, UAS Labs has six trademarked strains within a range of indications including digestive disorders, immune stimulation, infant probiotics, weight management, and other areas, and operates two GMP facilities in Wisconsin, close to Chr. Hansen’s own facilities in Milwaukee.
The fermentation capacity and downstream processing of the UAS facilities will complement Chr. Hansen’s own facilities, said the Danish company, allowing for increased flexibility in phasing of CAPEX projects in the coming years.
“Over the past seven years I have been honored to lead the team at UAS Labs with our science-backed probiotic solutions,” said Kevin Mehring, CEO of UAS Labs. “We have grown and matured in our strain to solution manufacturing capabilities and commitment to clinical research. I could not be more proud of all the dedicated individuals that have worked tirelessly to get us to this point. We are very excited to join Chr. Hansen, and by our shared vision and future.”
According to a webcast this morning, Chr Hansen's Graber said Mehring and Leyer are committed to staying with the business for the next three to five years.
Kent Velde, President of Lakeview Equity Partners, added: “The leadership and strategic vision of UAS Labs’ executive team, who we originally partnered with in this investment, took UAS Labs to a new level within the global probiotics industry. We are thrilled to have partnered with them. The company is well positioned for continued growth and success within Chr. Hansen’s business platform.”
Closing of the transaction is pending regulatory review in the United States, but is expected within one to three months, said Chr Hansen.
Chr. Hansen said its outlook for 2019/20 is unchanged, although there will be a minor negative impact to EBIT, depending on the timing of the closing.
