Further to the March 2014 Consent Agreement (the
"Agreement") entered into with Loblaw Companies Limited
("Loblaw") in connection with its $12.4 billion
acquisition of Shoppers Drug Mart Corporation
("Shoppers"), the Competition Bureau (the
"Bureau") has approved the sale of 13 Loblaw-owned stores
and pharmacies to Metro Inc., Remedy's Rx and the Jean Coutu
Under the terms of the divestiture, Loblaw will licence nine
pharmacies located in Loblaw-owned grocery stores to Remedy's
Rx. These pharmacies are located in Newfoundland and Labrador (two
pharmacies) and rural Ontario (seven pharmacies).
Additionally, Loblaw will divest two "No Frills"
grocery stores to Metro Inc. (both in Ontario) and two
"Shoppers Drug Mart" pharmacies to the Jean Coutu Group
(both in New Brunswick).
According to the Bureau's press release discussing its
review of Loblaw's acquisition of Shoppers, the competition
concerns in those four markets related to the sale of pharmacy
products within the grocery store (e.g., prescription medications
and over-the-counter drugs), as well as drugstore-type merchandise,
such as health and beauty aids (e.g., shampoo, facial tissues and
make-up), household items (e.g., cleaning products) and certain
food products (e.g., milk, eggs and cookies), all of which are
typically sold at both Loblaws and Shoppers Drug Mart stores.
Bureau Continuing to Investigate Loblaw's Relationships
While these divestitures address the competition concerns
associated with the Loblaws/Shoppers merger, the Bureau has
indicated that the Civil Matters Branch is investigating
various Loblaw policies and conduct related to pricing strategies
and programs with suppliers that reference rivals' prices. The
ongoing civil investigation indicates that the Bureau has
additional concerns unrelated to the merger regarding the potential
competitive impact of certain trade terms imposed by Loblaw on its
For a copy of the Bureau's press release, please click here.
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