Independent directors at Terry White Group (TWG) have unanimously recommended that shareholders accept a proposal from medical supplier, EBOS PH, to acquire all the minority shares in the pharmaceutical group that EBOS PH or its related bodies doesn’t already hold.
If approved, the shares would be acquired for A$3.55 per share. The move would enable TWG to have the scale and strength to fulfill its potential to become Australia’s pre-eminent health-focused retail pharmacy brand.
“This transaction represents a continuation of EBOS’ investment in TWG and provides a number of
economic and strategic benefits to TWG, as well as to TerryWhite Chemmart pharmacies and other
stakeholders,” TWG chairman Ron Higham said.
“EBOS is supportive of TWG’s strategies for the growth and development of the network including
additional investment in marketing to increase brand awareness and reinforce the network’s differentiated customer proposition.
“EBOS’ support for the execution of TWG’s growth strategies to expand and strengthen the TerryWhite Chemmart pharmacy network is critical in a challenging and competitive retail environment where scale and capital are essential.”
The pharmaceutical giant said that if the new scheme becomes effective, TWG would become wholly-owned by the medical supplier. TWG shareholders, other than EBOS PH, who are on TWG’s share register at the record date, would receive a cash payment of A$3.55 for each share held by the shareholders.
TWG would operate as part of EBOS Group’s broader healthcare business and remain the core retail pharmacy franchise operation of EBOS in Australia. The independent directors are the current directors of TWG, other than John Cullity and his alternate who are associated with EBOS PH.
EBOS chairman Mark Waller said the medical group has the financial resources and capability to enable TerryWhite Chemmart to become Australia’s pre-eminent health-focused retail pharmacy group.
“We believe, with EBOS’ support, TWG will have the financial strength to continue to innovate, pursue further expansion opportunities and accelerate the execution of its growth strategies. We are supportive of TWG management’s initiatives to improve the profitability of TerryWhite Chemmart pharmacies through supply chain efficiencies and by enhancing product ranges,” said Waller.
“We also support the continuation of the recently established TerryWhite Chemmart Advisory Group which operates to provide support to TWG management by providing marketplace input and support on its strategic vision, direction and key initiatives.”
TWG appointed BDO Corporate Finance (QLD) to see whether the scheme is in the best interests of shareholders and to provide the Independent Expert’s Report.
The pharmaceutical group said that the Scheme Booklet will be sent to TWG shareholders in November 2018. They can vote on the proposal at an EGM in December 2018. Once it’s finalised, the scheme is expected to be implemented, with payment of the scheme share consideration, in late December 2018.
EBOS PH is a wholly owned subsidiary of EBOS Group Limited and is the majority shareholder of TWG. Symbion is another wholly-owned subsidiary of EBOS and is also the first-line wholesale supplier to TerryWhite Chemmart pharmacies.