Thursday 20 Jun 2024
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KUALA LUMPUR (July 21): Creador-backed retail pharmacy chain BIG Pharmacy Healthcare Sdn Bhd has inked a deal to buy its competitor Caring Pharmacy Group Bhd from convenience store operator 7-Eleven Malaysia Holdings Bhd in a deal worth about RM900 million, sources told The Edge.

“7-Eleven has closed a deal for the sale of Caring Pharmacy. An announcement on the transaction is expected to be made as soon as today,” a source said.

Driven by the possible sale of Caring Pharmacy, shares of 7-Eleven gained 5.2% or 11 sen to RM2.24 at the time of writing. The counter hit a high of RM2.29 in the morning trading session, making it one of the top gainers on Bursa Malaysia on Friday (July 21). About 212,400 shares have changed hands so far.

7-Eleven owns 75% of Caring, while the remainder is held by Motivasi Optima Sdn Bhd. 7-Eleven’s largest shareholder is Berjaya Corp Bhd founder Tan Sri Vincent Tan, who controls 28.34% of the company.

Another source highlighted that BIG Pharmacy, which was the third highest bidder for Caring Pharmacy, has emerged as the winner after 7-Eleven’s negotiations with the two other main bidders for Caring Pharmacy — the US-based private equity fund Carlyle Group Carlyle and Luxembourg-based investment advisory firm CVC Capital Partners — fell through.

Citing sources, The Edge had in October last year reported that Carlyle Group was at the advanced stage of negotiation in acquiring Caring Pharmacy.

It was learnt that Carlyle Group had made a RM1.3 billion offer to buy the retail pharmacy chain, but 7-Eleven was seeking between RM1.5 billion and RM1.8 billion.

Meanwhile, it is understood that BIG Pharmacy, which operates 282 outlets, is actively expanding its stores ahead of its planned initial public offering (IPO).

BIG Pharmacy is co-founded by husband-and-wife qualified pharmacists Lee Meng Chuan and Lim Sin Yin.

A check on the Companies Commission of Malaysia (SSM) showed that BIG Pharmacy is 100%-owned by BIG Pharmacy Holdings Sdn Bhd (BPHSB).

Lee and Lim collectively have a direct stake of 15% in BPHSB. They also indirectly own a 40.22% stake in BPHSB via Uptown Paradise Sdn Bhd.

It is worth noting that local private equity firm Creador — founded by its CEO Brahmal Vasudevan — also has a 35.03% stake in BPHSB, held through Iris Pallida Sdn Bhd.

Edited BySurin Murugiah
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