(Bloomberg) -- Cinven agreed to buy out Synlab AG for about €1.27 billion ($1.3 billion) two years after listing the German laboratory operator, which has been suffering from reduced demand for its testing facilities.

Investors will get €10 a share in cash, Cinven’s Ephios Luxembourg unit said Friday. Cinven submitted a non-binding expression of interest in March to acquire Frankfurt-listed Synlab at that price, confirming an earlier Bloomberg News report. The bid is 42% higher than the closing price on March 10, before Cinven’s previous announcement.

A take-private of Synlab will make it easier for Cinven to transform the Munich-based company as it grapples with a post-pandemic decline in demand for testing facilities. The private equity firm already controls a stake of 42.8% in the company.

Cinven launched an initial public offering of Synlab in 2021, buoyed by a Covid-19 testing boom that sent the company’s valuation soaring to almost €5.5 billion in November of that year. But the stock has lost two-thirds of its value since, exacerbated by a profit warning.

Synlab shares rose as much as 24% to €10.10 in early trading in Frankfurt.

Synlab’s main competitors include Unilabs, a European diagnostics company that was taken over by AP Moller Holding A/S in 2022. Synlab’s other investors include Denmark’s Novo Holdings A/S and Canadian retirement fund Ontario Teachers’ Pension Plan Board.

Shareholders owning about 29.1% of Synlab have made irrevocable agreements to tender their shares.

(Updates with shares)

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