Australia's Sonic Healthcare eyes best day in 3 months on acquiring Swiss lab network

Synlab AG

27/06/2023 05:17

(Adds Jefferies' comments)
    ** Australia's Sonic Healthcare Ltd  SHL.AX  rises as much
as 2.8% to A$35.690 - set for best day since March 27, if gains
hold 
    ** Medical diagnostics firm says entered into a deal to
acquire SYNLAB Suisse SA, Swiss laboratory network of SYNLAB
Group  SYAB.DE , for 150 mln Swiss Francs ($167.4 million)
    ** SHL says deal will add to EPS from 2024 and return on
invested capital will exceed Sonic's cost of capital within two
years of acquisition
    ** Sonic will fund the acquisition with existing cash and
debt facilities
    ** Jefferies sees SHL continuing to generate cash after
completion of acquisition, says this raises possibility of
further corporate activity over the medium term which may be
seen positively
        ** Brokerage raises price target on co to A$36.60 from
A$36.50, maintains rating at "hold"  
  
    ** Stock has risen 15.8% this year, as of last close

($1 = 0.8962 Swiss francs)

 (Reporting by Jaskiran Singh and Nausheen Thusoo in Bengaluru)
 ((Jaskiran.Singh@thomsonreuters.com;))