Sigma and CWG Merger Risks and Management Overview
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Transformational Merger between Sigma and Chemist Warehouse
Group, and $400m Equity Raising for Sigma to Fund Growth
Proposed Merger with Chemist Warehouse Group
Transformational merger between Sigma and Chemist Warehouse Group (CWG) to create a leading
healthcare wholesaler, distributor and retail pharmacy franchisor (Proposed Merger)
•
•
Proposed Merger to be effected by Sigma acquiring CWG via a scheme of arrangement in exchange
for Sigma shares¹ and $700m cash consideration²
CWG shareholders to hold 85.75% and Sigma shareholders to hold 14.25% of MergeCo upon
completion of the Proposed Merger¹
Proposed Merger has the potential to unlock significant efficiencies, with cost synergies initially
estimated at c.$60m per annum, expected to be realised four years post completion³
CHEMIST
WAREHOUSE
CHEAPEST CHEMIST
CHEMIST
WAREHOUSE
DISCOUNT
AUSTRALLS
CHEAPEST CRANS
50%
OFF
CH
DISCOUNT
CHEMIST
PESCRIPTIONS
7
Sigma Equity Raising
Sigma to undertake a pro-rata accelerated non-renounceable entitlement offer to raise gross proceeds of
approximately $400m to fund increased working capital required to implement the new Chemist Warehouse
supply contract commencing 1 July 2024 and progress new business growth initiatives (Equity Raising)4
Notes:
1.
23
3.
4.
CWG shareholders will receive such number of Sigma shares that results in CWG shareholders owning 85.75% of MergeCo (on a fully diluted basis, including cash-settled and share-based rights, grants or other incentive arrangements which have either been exercised, exchanged or
converted for cash since 11 December 2023 or remain outstanding upon completion of the Proposed Merger). In conjunction with entering into the Merger Implementation Agreement (MIA), Sigma and CWG have agreed to defer the issuance of 126,947,040 Sigma shares already
agreed to be issued to CWG on 31 August 2023 in conjunction with the CWG supply agreement due to commence on 1 July 2024 (Placement Shares) while the MIA remains on foot. If the Proposed Merger completes, these Placement Shares will not be issued. If the MIA is terminated,
the Placement Shares will be issued to CWG (or a subsidiary of CWG) on the later of 1 July 2024 and 20 business days post termination of the MIA
Subject to any leakage adjustment under the MIA
On a run-rate basis. One-off costs to achieve estimated at c.$75m. Refer to page 28 for further detail
In the event the Proposed Merger proceeds to completion, and to the extent the proceeds have not been applied to fund working capital needs and new business initiatives - some of the net proceeds from the Entitlement Offer may instead be used to partially fund the cash consideration
to CWG shareholdersView entire presentation