Less than two years after acquiring Rose Pharmacy, Inc., a subsidiary of Hong Kong-based retailer Dairy Farm International Holdings, Ltd. sold the Cebu-based drugstore chain to a Robinsons Retail Holdings, Inc. (RRHI) subsidiary in exchange for shares.
In separate statements on October 16, 2020, the Gokongwei-led Robinsons Retail and Dairy Farm announced that they signed a share purchase agreement transferring 100% ownership of Rose Pharmacy to RRHI subsidiary South Star Drug, Inc. from Dairy Farm’s Dutch unit Mulgrave Corporation B.V.
Details of the share purchase agreement were not announced.
This is the second company that Dairy Farm sold to RRHI in exchange for shares, after Rustan Supercenters, Inc. Through Mulgrave, Dairy Farm already occupies two seats on the RRHI Board following a similar share purchase agreement for the sale of Rustan Supercenters in November 2018.
In a statement, Dairy Farm said it has agreed to deepen its strategic partnership with RRHI in building a leading pharmacy business in the Philippines by combining its interest in Rose Pharmacy with South Star Drug.
“Dairy Farm and Robinsons have been in partnership since 2018, and we share the same values and approach to delivering great value, services, and products to our customers,” said Dairy Farm Group chief executive Ian McLeod.
By bringing these businesses together we have created an enhanced and strengthened pharmacy network, which will provide growth opportunities to team members, and enable greater competitiveness, service and value to customers across the Philippines,” he added.
Dairy Farm acquired 49% of Rose Pharmacy from the BRG Realty Corporation of the Lim family in November 2014. The acquisition of the remaining 51% was completed in December 2018.
Related Story: Dairy Farm now fully owns Rose Pharmacy
Rose Pharmacy was founded by the Lim family in Cebu in 1952. It currently operates more than 300 branches in the Visayas and Mindanao with nearly P9 billion in net sales in 2019.
In a separate statement, South Star managing director David Goh said Rose Pharmacy is a very strategic addition to their portfolio.
He said Rose Pharmacy’s strong presence in the Visayas complements Southstar Drug, which is focused on Luzon and Metro Manila.
“Together, we can leverage our scale and synergies to drive wider product assortment, better customer service and offer greater value to our customers across Philippines when they need it most,” Goh said.
RRHI president and CEO Robina Gokongwei-Pe said the deal takes them back to Cebu, hometown of the late John Gokongwei Jr.
“I am delighted that Rose Pharmacy will be part of our portfolio as it takes us back to our hometown in Cebu, where my father and JG Summit Holdings and RRHI Founder John Gokongwei, Jr. started as an entrepreneur. Mr. John also admired Rose Pharmacy for its strong brand reputation in Visayas and Mindanao,” said Gokongwei-Pe.
It also bolsters their partnership with Dairy Farm to strengthen our position in Philippine multi-format retailing.
“We first worked with Dairy Farm for the acquisition of Rustan Supercenters, Inc. in 2018, which deepened our footprint in the premium supermarket space. Our acquisition of Rose Pharmacy yet again offers ripe opportunities for innovation through strategic synergies,” she continued.
Dairy Farm sold Rustan Supercenters to RRHI in exchange for a 20% equity in the Gokongwei-led retail company.
Rustan Supercenters operates Rustan’s Supermarket (now called Marketplace), Shopwise and Wellcome.
The Dairy Farm Group, a unit of Jardine Matheson Ltd., operates supermarkets and hypermarkets, health and beauty stores, home furnishings stores, restaurants and convenience stores across north and southeast Asia.
Its brands include Maxim’s, Mannings, Guardian and Yonghui. It also operates 7-Eleven outlets, Starbucks coffee shops and IKEA stores in Asia. (Ventures Cebu)