Oriola-KD to acquire 171 pharmacies in Swedish auction process
(Thomson Reuters ONE) - Oriola-KD Corporation Stock Exchange Release 9 November 2009 at 9.25amKronans Droghandel Retail AB, a company jointly owned by Oriola-KDCorporation and Kooperativa Förbundet (KF), has signed a sharepurchase agreement with Apoteket AB (publ) on the acquisition of 100per cent of the shares of Pharmacy Company Sweden 2 AB, a nationalpharmacy cluster with 171 pharmacies.Proforma net sales of the 171 pharmacies in 2008 were SEK 4.4billion, 14.5 per cent of Swedish pharmacy market. Proforma operatingprofit including average central overhead costs of Apoteket AB in2008 was SEK 183 million, 4.2 per cent of net sales. The net debt ofthe acquired pharmacy cluster at the end of August 2009 was SEK 136million. The pharmacy cluster employed 931 employees at the end of2008.The total purchase price of the acquisition is expected to beapproximately SEK 1.56 billion in cash. The closing of thetransaction is expected to take place in the first quarter of 2010,and is subject to approval by the Swedish Competition Authority(Konkurrensverket) and the granting of pharmacy licence by theSwedish Medical Products Agency (Läkemedelsverket).Cooperation with Kooperativa FörbundetIn connection with the acquisition, Oriola-KD and KF have completedthe previously announced collaboration on the Swedish pharmaceuticalretail market by establishing a joint venture company, KronansDroghandel Retail AB. According to the shareholders' agreement,Oriola-KD holds an 80 per cent ownership and KF 20 per cent in thecompany. The Board of Directors of Kronans Droghandel Retail ABconsists of four members appointed by Oriola-KD and one memberappointed by KF. Cecilia Marlow has been appointed as ManagingDirector of the company.The joint venture enables Kronans Droghandel Retail AB to establishnew pharmacies, mainly in conjunction with Coop's hyper andsupermarkets owned by KF. Oriola-KD will be responsible for thedevelopment and management of the pharmacy chain. The joint venturewill operate under the Kronans Droghandel brand.Takeover of pharmaciesOriola-KD has been preparing for the deregulated market for more than15 months with the objective of creating a leading pharmaceuticalretail chain on the Swedish market. A new retail organisation withthe required processes and capabilities has been established inStockholm. The organisation is fully prepared for the take-over ofpharmacies at closing, supported by a detailed cluster take-overplan. Oriola-KD will further develop the business operations andexpand its pharmacy chain in cooperation with KF in the long term.Financing the acquisitionOriola-KD and KF will finance the acquisition in part with an equityinvestment of SEK 600 million into Kronans Droghandel Retail AB. Inaddition to the equity financing, Kronans Droghandel Retail AB hassigned a SEK 1.3 billion credit facility with Nordea Bank Finlandplc, Pohjola Bank plc, Sampo Bank Plc and Svenska Handelsbanken AB(publ), Branch operation in Finland, in which Nordea Bank Finland Plcacted as the Agent.The facility will be used for financing the acquisition, investinginto the establishment of new pharmacies and for working capitalpurposes in Sweden. The credit facility includes financial covenantsbased on Oriola-KD's net debt to EBITDA and gearing ratio.Oriola-KD has started a sale of sales receivables programme(non-recourse) in Sweden with Pohjola Bank plc to finance its equityinvestment in Kronans Droghandel Retail AB. After closing of thetransaction, Oriola-KD's gearing ratio, which was 44 per cent at theend of September 2009, is expected to increase to the level of 100per cent.Supporting Oriola-KD's strategyThe acquisition is in line with Oriola-KD's strategy to expandoperations from pharmaceutical wholesale to pharmaceutical retail inall countries where Oriola-KD operates and where market regulationallows it.Oriola-KD's fully-owned subsidiary, Kronans Droghandel AB (KDPharma), has been operating on the Swedish pharmaceutical trademarket for more than 100 years. During the last 40 years thewholesale company has made daily nationwide deliveries ofpharmaceuticals to all of Apoteket AB's pharmacies fulfilling specialrequirements on quality and accuracy. The long experience in theSwedish pharmaceutical market makes this acquisition a logical nextstep for Oriola-KD to expand into the retail business. Oriola-KDentered the Russian pharmaceutical wholesale and retail market in2008 and is currently one of the leading pharmaceutical wholesale andretail companies in Russia.Deregulation of the Swedish pharmacy marketOn 29 April 2009, the Swedish Parliament decided to dismantle thecountry's pharmacy monopoly as of 1 July 2009. The deregulation ofthe pharmacy market makes it possible for operators other thanApoteket AB to engage in the pharmacy business in Sweden. With thederegulation, the seller announced that 466 pharmacies would be soldto large and medium-sized companies, while 150 pharmacies remainingin state ownership would later be sold to small entrepreneurs.Apoteket AB will retain ownership of 330 pharmacies. The total valueof Swedish pharmacy market in 2008 was some SEK 30.3 billion."The deregulation of the Swedish pharmaceutical retail market and theacquisition of pharmacies is an important strategic step and anexcellent investment opportunity for us in Sweden. Kronans Droghandelhas been building a retail organisation since August 2008 and hasmade considerable investments in preparing for this opportunity. Apharmacy concept designed for the Swedish market, a thoroughtake-over plan and a strong organisation are in place to support ourlong-term strategies and goals. Based on our combined experience andall measures taken, Kronans Droghandel is in an excellent position toensure an uninterrupted and secure flow of pharmaceuticals under allcircumstances in Sweden," said Eero Hautaniemi, President and CEO,Oriola-KD Corporation, and Lars Idermark, President and CEO,Kooperativa Förbundet.Invitation to conference callOriola-KD Corporation will have a teleconference on 9 November 2009at 4.00 pm Finnish time regarding the acquisition of pharmacies inSweden, tel. +358 9 69 379 735, confirmation number 2127424. Thelanguage of the teleconference will be English.Oriola-KD CorporationEero HautaniemiPresident and CEOKimmo VirtanenExecutive Vice President and CFOFurther information:Eero HautaniemiPresident and CEOtel. +358 (0)10 429 2109e-mail: eero.hautaniemi(at)oriola-kd.comKimmo VirtanenExecutive Vice President and CFOtel. +358 (0)10 429 2069e-mail: kimmo.virtanen(at)oriola-kd.comPellervo HämäläinenVice President, Communications and Investor Relationstel. +358 (0)10 429 2497e-mail: pellervo.hamalainen(at)oriola-kd.comDistribution:NASDAQ OMX Helsinki LtdPrincipal mediaPublished by:Oriola-KD CorporationCorporate CommunicationsOrionintie 5FI-02200 Espoo, Finlandwww.oriola-kd.comThis announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
Datum: 09.11.2009 - 08:25 Uhr
Sprache: Deutsch
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