McKesson, Celesio To Operate As Integrated Firm - Quick Facts

(RTTNews) - U.S. drug distributor McKesson Corp. (MCK) said the Stuttgart Higher Regional Court approved the registration of the domination and profit and loss transfer agreement between German drug distributor Celesio AG (CAKFF.PK) and McKesson Deutschland GmbH & Co. KGaA, an unit of McKesson, earlier today. The deal is expected to be formally registered shortly. The registration of the domination profit and loss transfer agreement marks a key milestone in Celesio, allowing both the companies to operate as an integrated company.

The combined group is expected to have annual revenues exceeding $170 billion, around 85,000 employees worldwide, and operations in more than 20 countries.

McKesson and Celesio serve nearly 120,000 pharmacy and hospital locations on a daily basis in the U.S., Canada, Europe and Brazil, including over 12,000 pharmacies that are either owned or are part of a strategic banner or franchise network of community pharmacies.

The operations of Celesio would be part of McKesson's Distribution Solutions business, headed by Paul Julian, executive vice president and group president, McKesson Corp. Celesio's operations would continue to be led by its management board with Marc Owen as its chairman, overseen by the Celesio Supervisory Board. Upon registration of the domination and profit and loss transfer deal, a newly formed Global Procurement team would lead the combined McKesson and Celesio strategy with its manufacturing partners worldwide.

By the fourth year following the registration of the domination profit and loss transfer agreement, McKesson expects to realize annual synergies between $275 million and $325 million. McKesson, which currently owns about 76% of Celesio's outstanding shares, would continue to consolidate the financial results of Celesio.