- Agreement reached with Competition
Bureau of Canada for acquisition of Rexall Health and acquisition
approved under Investment Canada Act.
- Canadians will benefit from greater
choice and access, integrated pharmacy care, and industry-leading
service levels.
- Domenic Pilla to provide overall
leadership for McKesson Canada, including Rexall Health;
Jürgen Schreiber to pursue other opportunities.
McKesson Corporation (NYSE:MCK), a leading international
healthcare services and information technology company, announced
today that it has completed the previously announced acquisition of
Rexall Health for $2.9 billion CAD ($2.1 billion USD*, or
approximately $1.7 billion USD*, net of certain estimated purchase
price adjustments, proceeds from store divestitures, and tax
benefits). This follows the agreement reached with the Competition
Bureau of Canada for the acquisition of Rexall Health and approval
received under the Investment Canada Act.
As part of the transaction, McKesson has acquired approximately
470 retail pharmacies, and has agreed to divest stores in 26 local
markets that the Competition Bureau of Canada identified during its
review of the transaction.
McKesson also announced today that Domenic Pilla has been
appointed CEO of McKesson Canada, effective January 3, 2017. Pilla
will report to Paul C. Julian, executive vice president and group
president, McKesson Corporation, and assume overall leadership
responsibility for McKesson’s distribution and retail businesses in
Canada, including Rexall Health. Jürgen Schreiber, currently CEO of
Rexall Health, will leave to pursue other opportunities.
“Today’s announcement marks a milestone for McKesson and Rexall
Health. With complementary assets, industry expertise, and shared
values, we will now serve our customers with enhanced retail
pharmacy capabilities and a broader reach across Canada,” said John
H. Hammergren, chairman and chief executive officer, McKesson
Corporation. “Patients across Canada will benefit from
best-in-class pharmacy care through innovative care solutions and
an expanded retail footprint. We are thankful to Daryl Katz,
founder and chairman of Katz Group, one of Canada’s largest
privately-owned enterprises, for having built such a strong
pharmacy asset in the Canadian market.”
With Rexall Health, McKesson will be able to serve a broad range
of pharmaceutical care and ensure choice to consumers at a time
when Canadians are increasingly turning to pharmacies for their
healthcare advice and services.
“Together, McKesson and Rexall can leverage shared expertise to
grow and deliver better care and value to Canadians,” said Julian.
“McKesson has a strong track record of delivering leading service
levels to customers and patients.”
“Domenic Pilla is uniquely qualified to lead our expanded
portfolio in Canada based on his previous experience as president
of Shoppers Drug Mart and McKesson Canada,” Julian continued. “He
brings deep knowledge of both the wholesale and retail sides of the
business, and a proven track record of delivering results. We thank
Jürgen Schreiber for his outstanding leadership in bringing this
acquisition to fruition and wish him the greatest success.”
Rexall Health will continue to have a dedicated management team
in Canada under Pilla, while retaining the existing brand Canadians
have come to know and trust. Pilla is expected to appoint a new
president of Rexall Health in the future to provide day-to-day
leadership for Rexall. His other direct report will be Paula Keays,
president of McKesson Canada.
McKesson now expects Rexall Health to be flat to adjusted
earnings per diluted share for Fiscal 2017 as earnings attributable
to Rexall Health will be offset by an anticipated charge related to
a fair value adjustment of acquired inventory. McKesson expects the
acquisition will be 30 to 35 cents accretive to adjusted earnings
per diluted share by the third year following the close of the
transaction, on a constant currency basis.
* $1 CAD = $0.74 USD
About McKesson Corporation
McKesson Corporation, currently ranked 5th on the FORTUNE 500,
is a healthcare services and information technology company
dedicated to making the business of healthcare run better. McKesson
partners with payers, hospitals, physician offices, pharmacies,
pharmaceutical companies and others across the spectrum of care to
build healthier organizations that deliver better care to patients
in every setting. McKesson helps its customers improve their
financial, operational, and clinical performance with solutions
that include pharmaceutical and medical-surgical supply management,
healthcare information technology, and business and clinical
services. For more information, visit www.mckesson.com.
About McKesson Canada
Founded more than 100 years ago, McKesson Canada is dedicated to
delivering vital medicines, supplies and information technologies
that enable the healthcare industry to provide patients better,
safer care. Our solutions empower pharmacies, manufacturers,
hospitals and other healthcare institutions by enabling them to get
closer to the millions of patients they serve every single day,
while contributing to the quality and safety of care in Canada. For
more information, visit www.mckesson.ca.
About Rexall Health
With a heritage dating back to 1904, Rexall Health and Rexall
Health Pharma Plus pharmacies are among the most trusted names in
retail pharmacy. Rexall Health is focused on helping Canadians feel
good about their health through easy access to a wide assortment of
health and wellness services and products. Supported by our team of
over 8,400 employees in over 470 pharmacies across the country,
Rexall Health is continually evolving to enhance the customer
experience. Rexall Health also includes Medicentres Canada, a group
of family healthcare clinics in Edmonton, Calgary, London and
Windsor where family physicians and specialists provide
high-quality and accessible healthcare services to individuals and
families, and Claimsecure, an industry-leading healthcare
management and technology firm that has been providing customized,
value added health benefit claims management and plan
administrative services to Canadian corporations and other health
benefit plan sponsors for over 30 years. For more information,
visit www.rexall.ca.
Risk Factors
This press release includes “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934, as amended,
that are subject to risks and uncertainties and other factors. All
statements other than statements of historical fact are statements
that could be deemed forward-looking statements, including the
expected benefits and costs of the transaction; any projections of
earnings, revenues or other financial items; any statements of the
plans, strategies and objectives of management for future
operations; any statements regarding product or service
development, extensions or integration; any statements of
expectation or belief; any statements regarding general industry
conditions and competition; any statements regarding economic
conditions; the possibility that expected benefits may not
materialize as expected; McKesson’s ability to successfully
implement integration strategies; as well as the ability to ensure
continued performance or market growth of the products and services
of Rexall Health. These risks, uncertainties and other factors, and
the general risks associated with McKesson’s business described in
the reports and other documents filed with the Securities and
Exchange Commission, could cause actual results to differ
materially from those referred to in the forward-looking
statements. All forward-looking statements are based on information
currently available to McKesson and are qualified in their entirety
by this cautionary statement. Except as required by law, McKesson
assumes no obligation to update any such forward-looking statements
or other statements included in this press release.
Shareholders are encouraged to review SEC filings and more
information about McKesson, which are located on the company’s
website.
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version on businesswire.com: http://www.businesswire.com/news/home/20161228005415/en/
McKesson Corporation Contacts:Investors and Financial
Media:Craig Mercer, 415-983-8391Craig.Mercer@mckesson.comGeneral
and Business Media:Kristin Hunter,
415-983-8974Kristin.Hunter@mckesson.comMcKesson Canada:David
Simmonds, 416-908-2587David.Simmonds@mckesson.ca
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