Neighbourly Pharmacy signs deal with largest shareholder to go private

TORONTO – Neighbourly Pharmacy Inc. has signed an agreement to be taken private by its largest shareholder in a deal that values the company at about $916 million.

Under the letter of intent, Persistence Capital Partners (PCP) has offered to pay $20.50 per share in cash for the stake in the company it does not already own.

Shares in Neighbourly, which owns a network of community pharmacies across Canada, closed down 44 cents at $12.12 on the Toronto Stock Exchange on Monday.

The company says the offer, which will require shareholder approval, also represents a premium of about 21 per cent to the company’s May 2021 initial public offering price of $17 per share.

PCP already owns about 22.4 million Neighbourly shares or a 50.2 per cent stake in the company.

PCP managing partner Stuart Elman says Neighbourly, as a private company, will have more flexibility and resources to pursue its strategic vision to advance the role that independent pharmacies can play in Canada.

“We are confident that this proposed transaction will benefit Neighbourly’s customers, patients, employees, and partners, as well as provide a fair and attractive return to its public shareholders,” Elman said in a statement.

This report by The Canadian Press was first published Oct. 3, 2023.

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