Thai Lab Instrument Distributor to be Acquired
Zurich, Switzerland 3/5/19—The Business Unit Technology of DKSH, a market expansion services provider, has agreed to purchase SPC. Financial details were not disclosed. SPC provides sales, marketing, application expertise and services for lab instruments and associated lab products in Thailand. The 430-person company generates CHF 50 million ($51 million at CHF 0.98 = $1) in revenues and is highly profitable. “Their business lines are complementary to DKSH’s existing activities and perfectly fit into our business model for Technology in Thailand. Our clients and customers will benefit greatly from a bigger portfolio, better market coverage and more value-added services,” stated Hanno Elbraechter, head of Business Unit Technology at DKSH. “DKSH will become the market leader in analytical instrumentation in Thailand and accelerate sustainable profitable growth.”
Founded in 1976, SPC works with more than 140 providers and serves both public labs and private labs in a variety of sectors. Mr. Elbraechter told IBO, “Up until now, DKSH and SPC were direct competitors in Thailand. The market for scientific instrumentation is still highly fragmented in the country, with many smaller family-owned distributors.” He added, “The combination of DKSH and SPC gives international lab suppliers the opportunity to better meet the demand in Southeast Asia’s second-largest economy. And for SPC’s existing clients, the acquisition gives them the opportunity to expand their products to other countries throughout Asia where DKSH has operations.”
Describing why Thailand is a particularly attractive market for DKSH Technology’s analytical instrument business, Mr. Elbraechter estimated the size of the country’s market for scientific instrumentation at $600 million growing at up to 10%. “Especially in the education and healthcare sectors, Thailand has shown steady growth in recent years. Two main drivers are the aging local population and the attractiveness of the country as an international health care destination,” he said. “As an indicator, output in physical science journals from Thai researchers has doubled from 2015 to 2018.” Other important segments are inspection and verification, according to him, due to inter-Asian trade, local exports and regulations.
Mr. Elbraechter emphasized, “With the acquisition of SPC, a key competitor and a top industry player, DKSH Technology has consolidated the market and became the largest player in scientific instrumentation in Thailand. We will ensure a seamless integration and drive further growth through three key areas: the strategy, the process and the people.” He continued, “The business lines of DKSH and SPC are complementary one to another.” As an example, he cited calibration services. “Also, the Thai market is currently undergoing a fast transformation, moving from a product-centric to a more service-driven focus. The acquisition of SPC means our customers will enjoy a more comprehensive, wider-range of calibration service offerings in the future.”
Finally, Mr. Elbraechter noted, “In terms of the process, we are the only company in the market expansion services industry with global-scale, world leading platforms in areas such as CRM, IT and finance,” he explained. “Through the strategy, the process, and the people, we will ensure a smooth integration, maximum benefits for our clients and customers, as well as a sustainable growth for both SPC and DKSH.”