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Private Equity Firm Buying Miraca Life Sciences for $177M

NEW YORK (360Dx) – Avista Capital Partners today announced a definitive agreement to buy anatomic pathology laboratory Miraca Life Sciences.

A new holding company called Symphony Buyer has been formed to become the new owner of MLS, which currently is a wholly owned subsidiary of Japanese holding firm Miraca Holdings. The basic enterprise value of the deal is approximately $175.6 million, Miraca Holdings said, adding it will own 15 percent of Symphony Buyer's shares.

Based in Irving, Texas MLS provides subspecialty anatomic pathology services in gastroenterology, dermatology, hematology, breast health, and urology, and serves more than 3,000 physicians and 5,500 patients daily, the companies said. Miraca Holdings said that when it acquired MLS in 2011, the deal facilitated its entry into the US anatomic pathology market.

Miraca Holdings implemented a growth strategy, but "the business environment changed drastically since the acquisition, including reimbursement cuts, including the most significant one in 2013." Various steps have been taken in response to the market changes, including "rationalization of operations," the development of new accounts, and the introduction of added-value services.

To realize growth, though, additional management resources and significant investments are required, including entry into the hospital market, and an expansion of scale, Miraca Holdings said. In order to maximize shareholder value, the decision was made to sell MLS to Avista, a private equity firm based in New York City with about $6 billion under management.

The transaction is anticipated to be completed in November.