Grupo Casa Saba, S.A.B. de C.V. ("GCS") (BMV:SAB*) announces that it has
executed an agreement under which Alliance Boots (“AB”) will acquire
GCS’s pharmacy retail business for an equity value consideration of $8.3
billion Mexican pesos.
The transaction will require AB to launch a tender offer for the shares
of Farmacias Ahumada S.A. (BCS:FASA) which trade on the Bolsa de
Comercio de Santiago. FASA is one of the leading pharmacy chains in
Latin America with over 1,400 stores across Mexico (primarily under the
Farmacias Benavides brand) and Chile (under the Farmacias Ahumada brand)
and is also the exclusive master franchise licensee for GNC, a chain of
health consumer products, in Chile and Brazil.
GCS which holds 97.8 of the shares of FASA through its subsidiary
Controladora Casa Saba, S.A. de C.V. (“CCS”), and GCS’s controlling
shareholder have irrevocably committed to tender its FASA shares to the
offer. GCS’s shareholders need to approve the transaction before the
tender is launched and the completion of the tender is subject to
anti-trust clearance in Mexico in Mexico.
This transaction has been approved by the Boards of Directors of GCS and
Alliance Boots GMBH and AB’s obligation to launch and complete the
tender offer will be subject to the satisfactory completion of certain
conditions. Such conditions include the approval of a majority of GCS
shareholders, regulatory approvals (including anti-trust authorities in
Mexico), and other customary closing conditions. We expect the
transaction to close during the third quarter of 2014.
Manuel Saba, Chairman of the Board of GCS, said, "Over the last four and
a half years we have successfully consolidated a business model with
clear and sustainable competitive advantages based on a deep,
experienced and dedicated team and state-of-the art technology. As a
result, we have strengthened FASA’s position as a leader in Mexico and
Chile, significantly improving profitability and reactivating selling
space growth. We believe this transaction brings clear benefits to all
stakeholders and is great news for FASA’s customers, employees,
suppliers and shareholders. This transaction also represents an
important patrimonial decision for GCS and its controlling shareholders
as it completely resolves recent liquidity issues at GCS and its
subsidiaries. Moreover, the investors to whom GCS had agreed to sell
GCS’s wholesale business, Casa Saba, have informed GCS of their intent
to approach AB with a view to have AB re-examine the Casa Saba wholesale
business.”
AB has today issued a press release in connection with this transaction.
Estructura Partners exclusively advised GCS in this transaction.
About GCS
Grupo Casa Saba is a holding company for Casa Saba and the FASA Group of
Companies. Grupo Casa Saba announced an agreement to sell Casa Saba to
Pharma Equity Global Fund LLC and World Global Equity Fund LLC in
December of 2013.
About Casa Saba (“CS”)
Casa Saba is one of the leading multi-channel, multi-product national
wholesale distributors in Mexico, operating one of Mexico’s largest
distribution networks of its type. CS distributes over 15,000 different
pharmaceutical products, health, beauty aids and consumer goods, general
merchandise and other products to a significant number of Mexico’s
pharmacies, mass merchandisers, retail and convenience stores,
supermarkets and other specialized channels through a nationwide
distribution network which serves over 14,000 pharmacies.
About Farmacias Ahumada
Farmacias Ahumada is network of pharmacies in Chile providing medicines,
pharmacy products, nutritional supplements, beauty, hygiene, personal
care and convenience items. Its store networks comprise primarily five
store formats: Farmacias Ahumada, Native, Farmarebajas, GNC and Guapa.
At December 2013, it operated around 400 outlets in around 98 cities
primarily in the central region of Chile, serving more than 47 million
customers. Farmacias Ahumada employs around 3,900 people,
About Farmacias Benavides
Farmacias Benavides is a network of pharmacies in Mexico, providing
medicines and pharmacy products, convenience items and health & beauty
products. It comprises around 1,000 stores which give it with coverage
of 21 states (over 150 cities, including Mexico City since 2013) and the
Federal District. At the end of 2013, Farmacias Benavides employed
around 7,800 people.
About Alliance Boots
Alliance Boots is a leading international, pharmacy-led health and
beauty group delivering a range of products and services to customers.
Working in close partnership with manufacturers and pharmacists, we are
committed to improving health in the local communities we serve and
helping our customers and patients to look and feel their best. Our
focus is on growing our two core businesses: pharmacy-led health and
beauty retailing and pharmaceutical wholesaling and distribution, while
increasingly developing and internationalizing our product brands.
Alliance Boots has a presence in more than 25* countries and employs
over 108,000* people. Alliance Boots has pharmacy-led health and beauty
retail businesses in nine* countries and operates more than 3,100*
health and beauty retail stores, of which just over 3,000* have a
pharmacy. In addition, Alliance Boots has around 605* optical practices,
of which around 190* operate on a franchise basis, and around 390*
hearing care practices. Our pharmaceutical wholesale businesses deliver
over 4.6 billion* units each year to more than 170,000* pharmacies,
doctors, health centres and hospitals from over 370* distribution
centres in 20* countries.
In June 2012, Alliance Boots announced that it had entered into a
strategic partnership with Walgreen Co., the largest drugstore chain in
the US, to create the first global pharmacy-led, health and wellbeing
enterprise.
*Figures are approximations as at 31 March 2013 and include associates
and joint ventures
Forward-Looking Statements
This press release contains certain "forward-looking statements" within
the meaning of Section 21E of the Securities and Exchange Act of 1934,
as amended. These forward-looking statements relate to GCS, FASA, AB,
their respective businesses and the transaction. Readers are cautioned
not to put undue reliance on such forward-looking statements, which are
not a guarantee of performance and are subject to a number of
uncertainties and other factors, many of which are outside GCS’s, FASA’s
and AB’s control, that could cause actual results of GCS, FASA, or AB to
differ materially from such statements. Factors that may cause or
contribute to such differences include adverse regulatory developments,
deterioration in relationships with suppliers, the imposition of
voluntary price restraints or statutory price controls by any
government, increased competition in the markets for pharmaceutical,
health & beauty, personal care and other consumer products, more
stringent environmental regulations, exchange rate fluctuations, high
levels of inflation and other risks.
The proposed transaction, the financial condition and results of the
companies will be subject to numerous risks and contingencies, including
successful regulatory approvals, the ability to realize synergies and
successfully integrate operations. None of GCS, FASA and AB are under
any obligation, and GCS, FASA and AB expressly disclaim any intention or
obligation, to update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise.
This press release includes unaudited pro forma financial information
that relates to the transaction. However, this information is
preliminary, not in accordance with generally accepted accounting
principles and not necessarily indicative of historical financial
position or of any future financial data.
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