Edison publishes SYGNIS research update and sees “Electrifiying Sales Potential” in the announced Expedeon acquisition
Madrid, Spain and Heidelberg, Germany, 25 May 2016 – Edison Investment Research Limited has published a research update on the DNA amplification and sequencing tools company SYGNIS AG (Frankfurt: LIO1; ISIN: DE000A1RFM03; Prime Standard segment of the German Stock Exchange) entitled “Electrifiying Sales Potential”.
According to the Edison analysts, the Expedeon deal in strategic terms is excellent for SYGNIS: the impact on SYGNIS’ combined sales line will be dramatic as the acquisition will broaden the product range and add direct sales. The businesses are complementary, with SYGNIS operating in emerging molecular biology sectors and Expedeon in more mature markets for protein analysis (proteomics), with cleverly designed products based around a core range of electrophoresis products. Expedeon has a UK- and US-focused sales and marketing team as well as a representative office in Singapore. Furthermore, Expedeon has strong OEM deals in place, e.g. with Sigma and Tanon. Edison believes that these deals might offer further opportunities for SYGNIS’ molecular biology products. Expedeon has a five-year sales CAGR of about 20% and was profitable with an EBITDA- margin of 13% in 2015.
Edison expects synergies from 2017 when both companies combine their product lines:
While SYGNIS’ core IP covers a range of novel engineered enzymes for genetic analysis and genome sequencing, Expedeon’s core sales include a range of electrophoresis products. The products offer good value through innovative features and are not discounted. These techniques have been used in biochemistry laboratories for decades to analyse mixtures of proteins and to get basic data like molecular weight.
Edison sees the two types of product lines to be often used in the same research facility so it should be easy to add in extra sales calls and boost the sales per call as a result. After Expedeon sales people have been trained and understand the relatively complex, technical and fast-moving molecular biology area with multiple competing products, the deal should deliver good synergies.
The full Edsion research report is available for download under http://www.edisoninvestmentresearch.com/research/report/sygnis4/full.
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