KUALA LUMPUR (July 21): 7-Eleven Malaysia Holdings Bhd announced that it has accepted an offer from BIG Pharmacy Healthcare Sdn Bhd to sell its 75% stake in Caring Pharmacy Group Bhd for RM637.5 million, confirming an earlier report by The Edge that the group has sealed a deal for the disposal of the pharmacy chain.
BIG Pharmacy is also acquiring the remaining 25% stake in Caring from Motivasi Optima Sdn Bhd, according to a statement from BIG Pharmacy on Friday (July 21). Motivasi Optima is owned by seven people, including Caring's founder and managing director Chong Yeow Siang, who holds an 18.65% stake.
BIG Pharmacy, according to 7-Eleven Malaysia, had proposed an equity valuation of RM850 million for the entire 100% stake in Caring. In its earlier report, The Edge, citing sources, reported that BIG Pharmacy, which is backed by local private equity firm Creador, was acquiring Caring in a deal worth about RM900 million.
7-Eleven Malaysia, which announced the disposal in a bourse filing, said its board has accepted the offer that its wholly owned Convenience Shopping (Sabah) Sdn Bhd had received in the form of a binding term sheet dated June 28 from BIG Pharmacy, subject to the execution of a binding agreement for the deal.
"The offer includes the acquisition by the purchaser of all Caring's subsidiaries and associated companies, which own and operate the retail pharmacy businesses under the 'CARiNG', 'Georgetown' and 'Wellings' brands, as well as any manufacturing and distribution of in-house products in Malaysia," its filing read.
The offer includes the acquisition of all intellectual property rights owned and used by Caring Group and its Indonesian businesses, but not the ownership of the businesses in Indonesia that are operated by PT Era Caring Indonesia — a 50.1%-owned indirect joint venture of Caring and PT Era Farma Indonesia, a 49.9%-owned indirect joint venture of Caring which will be carved out from the deal.
7-Eleven Malaysia said the disposal, which is expected to net the group a yet-to-be-disclosed one-off gain, provides it an opportunity to unlock and monetise its investment in Caring.
Post-disposal, 7-Eleven Malaysia expects to redirect its resources to grow its convenience store business. As to how the group plans to use the proceeds from the sale, it said this would be announced upon the signing of definitive documents for the disposal, including the sale and purchase agreement.
The disposal is subject to approvals from the group's shareholders at an upcoming extraordinary general meeting.
BIG Pharmacy, meanwhile, said the acquisition represents a strategic step in the group's mission to elevate the quality, accessibility and affordability of healthcare for Malaysians.
"This strategic move aligns perfectly with our mission to enhance healthcare outcomes and widen service access. By combining our expertise and resources, we aim to deliver unparalleled healthcare experience; reaffirming our commitment to community engagement,” said BIG Pharmacy's chief executive officer Lee Meng Chuan.
Trading of 7-Eleven Malaysia has been suspended since 2.30pm to make way for the announcement. Prior to the suspension, 7-Eleven's shares were trading at RM2.20, up seven sen or 3.29% from its Thursday close, giving the group a market capitalisation of RM2.58 billion.