It’s official. Loblaw has completed its acquisition of Shoppers Drug Mart Corporation, which is now a separate operating division of Loblaw.
"The most successful partnerships are grounded in strengths that complement each other," said Galen G. Weston, executive chairman, Loblaw. "Loblaw and Shoppers Drug Mart are perfect partners. We will drive growth and profitability through our unmatched mix of store formats, products and offerings. This is truly a case of the whole being greater than the sum of its parts."
Loblaw said that the acquisition strengthens both companies' competitiveness in an evolving retail landscape, creating new growth opportunities for shareholders. It will give consumers more choice, value and convenience through Canada's largest retail network of unmatched store formats, including Shoppers Drug Mart's important and growing footprint in the small-urban store sector, the company said.
"Consumers are more focused on health and wellness and they are demanding more convenient retail locations," said Vicente Trius, president, Loblaw Companies Limited. "Working together, we will capitalize on these consumer trends and create a compelling new blueprint for future growth and profitability."
The acquisition brings Loblaw and Shoppers Drug Mart within closer reach of more Canadians:
- 1 billion customer transactions per year
- More than 2,300 stores (corporate, franchised and associate-owned)
- Nearly 1,800 pharmacies
- 65 million sq. ft. of selling space
"I am very excited about our partnership with Loblaw, a company which also has a rich retail legacy of providing Canadians superior choice and value,” added Domenic Pilla, who remains president of Shoppers Drug Mart. “Together, we can learn from each company's expertise to grow and create exciting opportunities for our two businesses and for Shoppers Drug Mart Associate-owners."
On a pro-forma basis in 2013, the combined company generated revenue in excess of $43 billion and EBITDA of approximately $3 billion. The combination of companies is expected to deliver targeted synergies of approximately $100 million in the first 12 months and approximately $300 million throughout a three-year period. First-year synergies are expected to come from the cost of goods sold and purchasing efficiencies in goods not for resale. Planned synergies are not dependent on any store closings.