McKesson to divest UK businesses to Aurelius

McKesson to divest UK businesses to Aurelius

3 November 2021 - Deborah Wilkes

  • McKesson Corporation to sell UK businesses to Aurelius
  • Deal includes Lloydspharmacy retail chain
  • Follows sale of some European assets to Germany’s Phoenix
  • US-based McKesson aims to fully exit the European region

McKesson Corporation is selling its UK businesses, including the Lloydspharmacy retail chain, to private-equity firm Aurelius for an enterprise value of GBP477 million (USD650 million).

Tristan Nagler, Aurelius partner, said the company saw significant potential in all four segments of McKesson UK – retail, digital, homecare and wholesale – to grow and enhance the business along with delivering further benefits to customers through additional investments.

In addition to Lloydspharmacy, Aurelius will gain AAH Pharmaceuticals, John Bell & Croyden, LloydsDirect, LloydsPharmacy Clinical Homecare, LloydsPharmacy Online Doctor and MASTA. The Lloydspharmacy chain has more than 1,400 pharmacies in the UK.

Aurelius said the McKesson UK businesses had generated sales of more than GBP5 billion and Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) in the “high double-digit millions” in 2020.

The deal is expected to be completed in the first quarter of 2022.

McKesson said the agreement was “another important step in advancing its commitment to streamline the business and fully exit the European region”.

Recent deal with Germany’s Phoenix

News of the deal comes soon after the US-based healthcare company agreed to sell its businesses in several European countries to German wholesaler and retailer Phoenix (click here to read the News story).

The deal with Phoenix covered businesses in Belgium, France, Ireland, Italy, Portugal and Slovenia. It also included 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.

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

In the three months ended 30 September 2021, McKesson Corporation’s sales – including its US Pharmaceutical, International, Medical-Surgical Solutions and Prescription Technology Solutions businesses – increased by 9% to USD66.6 billion.

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