7-Eleven Exploring Pharmaceutical Industry

By CodeBlue |

7-Eleven is acquiring Caring Pharmacy.

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KUALA LUMPUR, Dec 9 — 7-Eleven Malaysia Holdings Bhd is planning to enter the pharmaceutical industry with its recent proposed acquisition of pharmacy chain, Caring Pharmacy Group Bhd.

StarBiz reported positive sentiment from analysts, who observed positive same store sales growth currently, which were previously negative, and projected growth in this financial year and the next.

“Caring offers inroads into a growing retail pharmacy and personal goods market, which 7-Eleven has no presence in. The acquisition could enhance 7-Eleven’s net profit by RM13.5mil per annum assuming low borrowing costs,” Maybank Investment analyst Jade Tam was quoted saying, who is maintaining her “hold” call on 7-Eleven pending the completion of the acquisition.

According to StarBiz, the convenience store chain’s net profit for the nine-month period until September 30 this year was RM42.71 million from RM38.82 in the previous year, while revenue rose to RM1.77 billion from RM1.67 billion in the same period.

7-Eleven reportedly has some 2,300 outlets throughout the country, while Caring Pharmacy has 132 outlets, with plans to expand to 200 by 2024.

7-Eleven’s wholly owned subsidiary Convenience Shopping (Sabah) Sdn Bhd, last month, and persons acting in concert (PACs) proposed a conditional mandatory general offer for Caring Pharmacy Group Bhd for RM2.60 per share, which means a valuation for the pharmacy company of RM566 million. The PACs are 7-Eleven, tycoon Vincent Tan, Jitumaju Sdn Bhd and U Telemedia Sdn Bhd.

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