TORONTO, ONTARIO - Loblaw is selling 10 Shoppers Drug Mart stores in locations throughout Ontario, Alberta, Nova Scotia and Prince Edward Island. According to Global News, seven of the ten stores will be sold to independent pharmacists running stores under the McKesson brand name. The remaining three stores are being sold to Pharmasave Drugs in Atlantic Canada.
The impetus for this sale stretches back to last year's $12.4 billion merger deal which united Loblaw and Shoppers Drug Mart. Canada's Competition Bureau's approval on the deal hinged on a condition that the combined companies would divest themselves of locations in areas where multiple store locations could have an adverse affect on market competition, leading to upward pressure on pricing. The Bureau cited 27 such local markets where these concerns existed in its initial report on the merger.
“Competition generally leads to lower prices for consumers, as well as more consumer choice, a wider range of service options and increased innovation,” explained a Competition Bureau regulator in an official statement.
Shoppers Drug Mart has been attracting increasing interest from the fresh produce industry in recent months with its addition of fresh produce into several of its stores in an important market test case. As AndNowUKnow previously covered, the success of this test case could add Shoppers as an important new retail client for companies throughout the industry, giving more customers access to the fresh fruits and vegetables which are key to a healthy lifestyle.
According to the Global News, Loblaw is still required to sell another four locations in order to fulfill its obligation to the Bureau. To this date, it has sold 14 total stores and nine in-store pharmacies.
Stay tuned to AndNowUKnow for updates on Loblaw's future operations as it moves forward after its merger with Shoppers Drug Mart.