Forensic science group up for grabs at £700m

Massive return for DNA tester that was privatised for £3million in 1996

PRIVATE equity firm Bridgepoint is poised to sell LGC – which supplies forensic science services to the police and acts as the Government’s official chemist, testing food and drugs for safety – for up to £700million.

Bridgepoint said it has hired advisers from investment banks JP Morgan and HSBC to work on its ‘mergers and acquisition’ plans.

But banking sources regard the appointments as a sure sign that Bridgepoint is considering a sale within the next few months.

LGC – known as the Laboratory of the Government Chemist when it was state-owned – was privatised for just £3million in 1996. Since then it has changed hands several times for increasing amounts.

Bridgepoint is expected to make a huge return on its original investment. It bought LGC from smaller rival private equity outfit Legal & General Ventures for £257million in 2010.

LGC was formed in 1842 when the Laboratory Board of Excise was founded in the City of London to test the purity of tobacco.

In 1875 the group was appointed ‘referee analyst’ under the Sale of Food and Drugs Act, a landmark piece of legislation designed to protect the consumer. It carried out tasks such as ensuring that milk had not been watered down.

The private company was formed in 1996 as LGC after the Tory Government under Sir John Major decided on a sell-off.

However, LGC remained the Government’s official chemist and it provides expert opinion in disputes over food, drugs and agriculture.

LGC has grown substantially since privatisation as Bridgepoint backed the group to carry out takeovers, including the buyout of HFL Sport Science, a leading provider of drug tests for racehorses.

The company’s workforce has risen from 270 in 1996 to 2,000 in 2014 and the business has offices in places including Beijing in China, Mumbai in India and Berlin in Germany.

The chief executive of LGC is Tim Robinson, who succeeded David Richardson in 2013.

A spokesman for Bridgepoint said: ‘There is currently no sales process. Instead, LGC has appointed JP Morgan and HSBC to advise it on its mergers and acquisitions pipeline.’