The directors of ASX-listed Citadel Group are supporting a bid from private equity firm Pacific Equity Partners (PEP) to buy out the company for $503.1 million.

Citadel Group's healthcare division Citadel Health markets the Evolution laboratory information system, previously known as Auslab, along with the Charm oncology solution.

Citadel recently received an extension to its decades-long contract with Queensland Health for Auslab following the cancellation of the $64 million laboratory information system replacement project with Sunquest. It is also used by NSW Health Pathology and several large health services in Victoria.