McKesson selling some businesses to Phoenix

McKesson selling some businesses to Phoenix
The deal gives Phoenix an entry into Belgium, Ireland, Portugal and Slovenia, says Sven Seidel, chief executive officer of Phoenix

8 July 2021 - Deborah Wilkes

McKesson has agreed to sell McKesson Europe’s businesses in several countries to German wholesaler and retailer Phoenix and is exploring strategic alternatives in a number of other countries including the UK with its Lloydspharmacy chain.

Phoenix is acquiring businesses in Belgium, France, Ireland, Italy, Portugal and Slovenia.

The transaction also includes McKesson’s European headquarters in Germany, its German woundcare business, its shared services centre in Lithuania, its German company Recucare, and its 45% ownership stake in Brocacef, the company’s joint venture in the Netherlands.

Entering new countries

Commenting on the deal, Sven Seidel, chief executive officer of Phoenix, said it gave his company an entry into Belgium, Ireland, Portugal and Slovenia.

“With this step, we are strengthening the position of the Phoenix group as an integrated healthcare provider with a pan-European presence and locally well established brands,” added Seidel.

Phoenix says its retail business currently operates more than 2,800 of its own pharmacies in 14 countries. Around 1,500 of these operate under the BENU brand.

Countries where Phoenix operates pharmacies include the Czech Republic, Hungary, Latvia, Lithuania, Montenegro, the Netherlands, Norway, Romania, Serbia, Slovakia, Switzerland and the UK.

The pharmaceutical wholesale business has 161 distribution centres in 27 European countries.

The transaction is expected to be completed in 2022.

Exploring strategic alternatives

Meanwhile, McKesson said it was exploring strategic alternatives for all remaining business in Austria, Denmark, Norway and the UK. It will retain its minority equity stake in the Germany joint venture with Walgreens Boots Alliance (WBA).

US-based McKesson commented that it wanted to “focus future investments on growth strategies outside of Europe”.

“Today’s transaction marks an important step in advancing McKesson’s commitment to streamline the business and prioritise investments in the areas where we have deep expertise and are central to our long-term growth strategy,” said Brian Tyler, McKesson’s chief executive officer.

The news comes soon after a media report suggested McKesson was in talks to sell its European operations including the Lloydspharmacy retail chain. Bloomberg said the businesses could be valued at between USD3 billion and USD4 billion (click here to read the News story).

McKesson Europe says it is active in 12 European countries, with around 2,000 McKesson-owned pharmacies and 97 wholesale branches. More than 1,400 of the pharmacies are in the UK under the Lloydspharmacy banner.

The 12 countries are Austria, Belgium, Denmark, France, Germany, Ireland, Italy, the Netherlands, Norway, Portugal, Slovenia and the UK.

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