South Africa’s Competition Tribunal is set to hear the transaction involving Clicks Pharmaceutical Wholesale’s R281-million acquisition of New United Pharmaceutical Distributors (NUPD), on December 4.
The deal has already been unconditionally approved by the Competition Commission.
Clicks Pharmaceutical, wholly owned by listed retailer New Clicks (NCL), is the retail distributor for New Clicks’ health and beauty products, while NUPD is involved in the wholesale distribution of pharmaceuticals to over 4 000 pharmacies, doctors and hospitals in South Africa and around southern Africa.
The acquisition forms part of New Clicks’ strategy to expand its operations into pharmaceuticals and healthcare in South Africa, which has seen the company involve itself in supplying the 400-store Link pharmacy franchise as well as owning a majority of the Link Investment Trust, through which it has been financing the purchase of a flagship chain of pharmacies by Purchase Milton & Associates.
Current law prevents New Clicks (or any non-pharmacist or company) from owning pharmacies in South Africa, but a change in the law to allow such
ownership has been on the cards for a few years.
In its own recent investigation, Competition Commission concluded that the merger did not raise competition concerns and recommended that it be approved unconditionally. It considered complaints relating to the possibility of Clicks entering the pharmaceutical retail market, but found that these were either unjustified or unrelated to competition concerns. – I-Net Bridge