CFO Lerena Olivier on the sale of Pick n Pay’s retail pharmacy business
Lerena explains that Pick n Pay’s growth strategy does not include its pharmacy division.
Pick n Pay plans to sell its retail pharmacy business to the Clicks Group, including 25 in-store pharmacies, which will be rebranded to Clicks.
“Pharmacy stores have always been a very small part of our business, and it is difficult for us to compete against the larger players, particularly where their pharmacy operations are vertically integrated,” says Pick n Pay CFO Lerena Olivier.
Pick n Pay has recently set out its key strategic objectives in terms of future growth, which do not include the development of a large pharmacy division. Lerena explains that the pharmacy division is a very small part of the Pick n Pay business and that the sale thereof will have no material impact on the business. Instead, Pick n Pay is focusing on growing sales in its core business, and in accelerating its growth engines – particularly Boxer and its online platforms.
Clicks will acquire the pharmacy licences and ethical drug stock, while all staff employed in the pharmacies will transfer from Pick n Pay to Clicks. “The deal with Clicks enables us to exit a non-core area while protecting the service for customers, and preserving all affected jobs,” Lerena says.
The acquisition will increase Clicks’ national presence to 632 pharmacies. Clicks Group CEO Vikesh Ramsunder said in a statement that the acquisition accelerates the company’s strategy of extending the convenience and accessibility of the Clicks pharmacy network. “Currently, 50 percent of the country’s population live within six kilometres of a Clicks pharmacy and we aim to improve this over time as we get closer to customers.”
The transaction is still subject to approval by competition and regulatory authorities.