Bestway's successful bid for the Co-operative Pharmacy in July raised many eyebrows. The company, which started out as a convenience store, had no prior experience in the healthcare sector and revealed very little about its plans for the multiple. So why did Bestway buy the third-largest multiple and what will the deal mean for the brand and its employees?
What is Bestway?
The Bestway name may be unfamiliar to many community pharmacists. However, the company has been established for more than 40 years and is, in fact, the UK's second largest independent wholesale and cash-and-carry operator.
It started out in 1963 as a convenience store in Earl's Court, London, and was set up by chair Sir Anwar Pervez. Since then, it has become the seventh largest family-owned business in the UK and has more than 5,000 employees in the country.
Its retail arm is its most profitable, but it also owns the largest cement division in Pakistan and Pakistan's second largest private bank.
How much is Bestway worth?
Bestway had turnover of £2.5 billion and operating profit of £220 million in the year ending June 2013. Its retail arm accounts for £2.4bn of its turnover and the rest comes from its cement and banking divisions.
With the acquisition of the Co-operative Pharmacy, the company will have an annual turnover of around £3.6bn and a global workforce of more than 33,000 people, 11,900 of whom will be in the UK.
Why the Co-op?
Bestway has had its eye on expanding into the healthcare sector for a while, it tells C+D. Firstly, it saw an opportunity for consolidation and growth in the "fragmented" pharmacy industry. It also recognised a demographic trend towards an increasing demand for healthcare services, as the population grows and people live longer.
It also says it was attracted to the values of the Co-operative Pharmacy. Bestway's philanthropic arm - the Bestway Foundation - annually donates 2.5 per cent of its post-tax profits to social projects in the countries it operates in.
Will the Co-op brand remain?
For the first 12 months, yes, the Co-operative branding will remain. However, over the next year a rebrand is being planned and Bestway says it will be working closely with the Co-operative Pharmacy's management team to make sure it fits with company values.
Is my job safe?
No job losses are planned as a result of the acquisition, Bestway says. The company emphasises that it did not buy the business to change it. The Co-operative Pharmacy will continue to be run from Manchester under the existing management team and Bestway will back them to "grow the business over the long term", it pledges.