Australian pharmaceutical wholesaler Sigma Healthcare is striking a deal to enter the UK as it reports continued strong momentum across its Chemist Warehouse network.
The ASX-listed company has signed a memorandum of understanding with GreenLight Healthcare Limited to form a joint venture that will roll out the Chemist Warehouse brand in the UK.
Under the agreement, Sigma will acquire a 75 per cent stake in a number of GreenLight stores, with the UK-based partner retaining 25 per cent. The London-founded pharmacy group currently operates 22 locations.
The rollout will begin with the rebranding and development of up to five locations, including a flagship site planned for Hoxton Street in northeast London. Further expansion will depend on the performance of the initial stores.
Sigma will licence the Chemist Warehouse brand and provide retail capabilities including ranging, store layout, inventory management and marketing, while GreenLight will manage dispensary services and back-end operations.
The deal represents a calculated step into a new market and builds on Sigma’s growing international presence, following gains in regions including New Zealand and Ireland.
CEO and MD Vikesh Ramsunder said international expansion remains a key pillar of growth, with the partnership providing a pathway into a large and established pharmacy market.
“Sigma is currently well placed to navigate the global geopolitical challenges impacting many businesses,” said Ramsunder.
“We are absorbing increased fuel costs within existing financial targets and hold significant inventory in our DC network to service the market. We are currently not seeing any material disruption in our ability to source or deliver products or services at this point.”
In addition, Sigma is investing in its New Zealand supply chain, securing a long-term lease for a 23,000sqm distribution centre in Wiri, in South Auckland, to support its expanding store network.
This article was first published on Inside Retail.
