THE world’s leading allergy-testing company is close to appointing advisers to handle a possible €1 billion (£685m) sale of the business.

The owners of Phadia, which until last month was called Pharmacia Diagnostics, have been interviewing investment banks over the past week with a view to hiring one to explore the company’s strategic options.

The review will consider all possibilities, including a sale, a flotation, or deciding no corporate activity is necessary.

Phadia’s backers are private-equity groups PPM Capital, a division of British insurance giant Prudential, and Triton.

They have seen presentations from a small number of banks, said to include Morgan Stanley, NM Rothschild, Citigroup and UBS.

Analysts estimate that Phadia could be worth up to €1 billion, including its debts.

Phadia is headquartered in Sweden, but has 19 offices around the world, including in the UK.

The firm specialises in developing and marketing blood- test systems for the clinical diagnosis of allergies. It also makes tests for asthma and other auto-immune diseases, such as diabetes and rheumatoid arthritis.

The company is currently developing a test that can indicate reaction to an allergen within 20 minutes.

Phadia supplies its testing equipment to more than 3,000 laboratories in over 60 countries. It recently expanded with the acquisition of fellow Swedish company MIAB, a provider of allergens and a supplier to Phadia.

The diagnostics operation was founded by a trio of scientists in 1967 as a unit of Pharmacia, the Swedish pharmaceutical company.

The parent went through a number of corporate ownership changes, leading to a merger with America’s Upjohn in 1995.

The enlarged group was taken over by Pfizer, maker of Viagra, in 2003.

After the deal, Pfizer began offloading non-core businesses. The shake-out saw PPM and Triton lead a $575m buyout of Pharmacia Diagnostics.

The two firms backed the management team, led by chief executive Magnus Lundberg. They oversaw a refinancing of the business in September 2005.

PPM Capital’s other high- profile investments include discount retailer TJ Hughes and the French jewellery chain Histoire d’Or.

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