Eurofins Scientific (EUFI.PA) said the outsourcing agreement for the Central Laboratories Friedrichsdorf (CLF) offers the opportunity to work on finished products and expand their technical knowhow required in the production process.
The testing firm added that infant nutrition analyses for Danone and Milupa, its infant nutrition arm in Germany, will represent at least €30m in revenues over five years.
They said there was potential to expand the “long-term” agreement in the future.
Eurofins, through CLF, will be able to provide Danone and its partners with analytical service, a specialized laboratory and testing for mycotoxins, vitamins, pesticides and raw materials.
The agreement was described as a natural progression from a relationship that goes back a few years, although no details were released, and it built on the trend of more people in the food industry outsourcing.
Different stages in the product production process involves different pathogens, compounds and substances that require separate testing as when it is put together the properties can change.
The agreement strengthens Eurofins’ footprint in nutritional analysis, and allows them to develop CLF as its competence center for baby food analysis, a market it identified as having premium growth opportunities.
Decades of experience
CLF was previously the in-house laboratory of Milupa within the Danone Baby Nutrition division, and has been performing analyses and quality assurance for at least 17 years.
Clients will benefit from gaining access to analytical methods and technologies within Eurofins and the firm said it will invest in equipment, IT solutions and other facilities to enable CLF to develop into a global reference laboratory for infant nutrition.
Dr Gilles Martin, CEO of Eurofins Scientific, said: “This agreement reflects the trust of clients who are as committed to the quality and safety of their products as Eurofins is to providing consistently high-quality service.
“The agreement also demonstrates the benefits of outsourcing. Providing high-quality analyses at reduced turn-around time, cost and capex requirements should benefit clients like Danone, allowing them to focus on their core strengths and maximize efficiency.”