Loblaw buying files from 95 Zellers pharmacies for $35M
A Zellers store is seen in Cambridge, Ont. on Thursday, Jan. 5, 2012.
Published Saturday, March 24, 2012 11:40AM EDT
BRAMPTON, Ont. - Loblaw Companies Ltd. is buying the majority of the prescription files of the vanishing Zellers Inc. department store chain in a deal worth about $35 million.
"This move underscores Loblaw's commitment to becoming the nation's health and wellness destination of which pharmacy is a cornerstone," Canada's largest grocer said Friday in a news release announcing the purchase.
"Loblaw will provide continuity of care to Zellers' pharmacy patients starting with a customer focused transition plan."
Under the arrangement, Loblaw will acquire the prescription files of 95 Zellers pharmacies across the country, excluding British Columbia and Quebec.
Zellers stores are slated to disappear as Target Corp. (NYSE:TGT) begins moving into Canada next year.
Zellers said in a statement late Friday it "reaffirms its commitment to ensuring continuity of care to all its pharmacy patients." That includes its remaining 99 pharmacies in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick and Nova Scotia.
"Zellers' patients can be assured that it is committed to ensuring customer information remains protected in accordance with privacy legislation," it said.
The U.S. retail giant is taking over leases at 189 Zellers locations in Canada and plans to open between 125 and 135 stores, while Walmart will take over 39 Zellers locations. Both also operate pharmacies.
Loblaw, a subsidiary of George Weston Ltd. (TSX:WN), has close to 500 pharmacies, which ensures there is a Loblaw store pharmacy neighbouring each of the 95 locations, the company said.
"Our goal is to be the number one nutrition and health destination in Canada," said Michael Lovsin, Loblaw senior vice-president, health and wellness.
"We feed more Canadians than any other grocery retailer in the country and with this comes responsibility to help them make healthier food and lifestyle choices. Our pharmacy business plays an important role in this effort."
Additionally, Loblaw banner stores are home to more than 100 affiliated medical clinics, 100 optical stores and 60 Good Life Fitness facilities.
On the Toronto Stock Exchange, Loblaw shares closed up $1.03, or more than three per cent, at $34.17 on Friday.