BRAMPTON, ON and KELOWNA, BC, Aug. 22, 2016 /CNW/ - Loblaw Companies Limited (TSX:L) and QHR Corporation (TSXV:QHR) today announced a definitive agreement under which Loblaw will acquire all of the outstanding common shares of QHR. QHR is a Canadian healthcare technology company and a leader in the electronic medical records (EMR) market, providing software for healthcare providers and their patients.
Under the terms of the agreement announced today, Loblaw has agreed to acquire all of QHR's outstanding common shares for $3.10 in cash per each QHR share, or approximately $170 million in the aggregate. This price represents a 29% premium to the 20-day volume weighted average trading price of QHR's common shares on the TSXV and 22% premium to the closing price of QHR's common shares on the TSXV, as of August 19, 2016. In addition, all holders of outstanding stock options of QHR which have an exercise price below the purchase price of $3.10 per QHR share will be entitled to receive the "in-the-money" value of such stock options, less applicable withholdings.
The transaction has been unanimously approved by the board of directors of QHR on the recommendation of an independent committee of the board of directors. Paradigm Capital is acting as financial advisor to the board of directors of QHR for purposes of this transaction and has delivered an opinion to the board of directors that the consideration under the transaction is fair, from a financial point of view, to QHR shareholders. QHR shareholders, including all of its directors and officers, PenderFund Capital Management Ltd. and Al Hildebrandt, which collectively control approximately 23% of the outstanding common shares have entered into binding agreements in which, subject to the terms and conditions therein, they have committed to vote in favour of the transaction.
QHR is a natural complement for Loblaw, a trusted source of pharmacy and health and wellness solutions for patients and providers nationally. QHR is expected to operate as a distinct business within the Shoppers Drug Mart division of Loblaw, and remain headquartered in Kelowna, British Columbia. The transaction has the full support of QHR's management team, who have all agreed to continue with QHR in their current roles and be a part of Loblaw's broader pharmacy and healthcare group.
"The future of healthcare is digital and this strategic investment will make us a better partner to patients and providers," said Jeff Leger, Executive Vice President, Pharmacy and Healthcare, Loblaw and Shoppers Drug Mart. "QHR brings complementary talent and technology to our organization, providing opportunities to establish new business partnerships and drive improved care coordination for Canadians."
Today, QHR supports 7,700 healthcare providers, representing about 20% of EMR technology use nationwide. It will continue to develop its leading EMR platform and interoperability, and expand solutions for effective patient care and practice management.
"Our focus, as always, remains great service and the continued delivery of innovative technology that connects healthcare providers and their patients," said Mike Checkley, the President and Chief Executive Officer of QHR. "We are excited to join Shoppers Drug Mart and we see the acquisition as a great vote of confidence for our team, our technology solutions, and the thousands of physicians and business partners that rely on our products daily."
The transaction will be carried out by way of a statutory plan of arrangement and will require court approval and the approval of at least 66 2/3% of the votes cast by the shareholders of QHR at a special meeting expected to take place in October 2016. Further information regarding the transaction will be included in the management proxy circular expected to be mailed to QHR shareholders in September. Copies of the arrangement agreement and the management proxy circular will be available on SEDAR at www.sedar.com. Loblaw and QHR anticipate that the transaction will be completed in the fourth quarter of 2016.
About Loblaw Companies Limited: With more than 2,400 independent and corporate-owned grocery stores and pharmacies, Loblaw is a Canadian retail leader, dedicated to advancing the health and wellness of Canadians. Its company purpose – Live Life Well – is supported by its 5,000 healthcare professionals, including pharmacists, opticians, dietitians, and nurses, offering a range of services like prescriptions, med checks, flu shots, minor-ailment diagnoses, and nutrition consultations. Each week, 17 million Canadians interact with Loblaw in stores or online.
About QHR: QHR is a leader in healthcare technology, empowering providers and connecting patients. With a 12-year track record offering what is now the single leading electronic medical records platform in Canada, QHR has a suite of complementary offerings that empower health professionals. The company's technologies and services enable secure medical records management for clinical environments, empowering health providers with tools for virtual care, including secure video and messaging, as well as tools for clinic management including scheduling, billing, and patient management. Health providers choose QHR to drive efficiencies within their practice and improve the quality of care delivered to patients.
This news release contains forward-looking statements about the proposed acquisition by Loblaw of all of the outstanding common shares of QHR. Specific forward-looking statements in this news release include, but are not limited to, statements with respect to certain strategic benefits; the timing of the QHR shareholders meeting and publication of related shareholder materials; and the expected completion date of the proposed transaction. Forward-looking statements are typically identified by words such as "expect", "anticipate", "believe", "foresee", "could", "estimate", "goal", "intend", "plan", "seek", "strive", "will", "may" and "should" and similar expressions.
There can be no assurance that the proposed transaction will occur or that the anticipated strategic benefits will be realized. The proposed transaction is subject to shareholder and court approvals and the fulfillment of certain conditions, and there can be no assurance that any such approvals will be obtained and/or any such conditions will be met. The proposed transaction could be modified, restricted or terminated.
Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect Loblaw's and QHR's expectations only as of the date of this news release. Loblaw and QHR disclaim any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise except as require by law.
SOURCE Loblaw Companies Limited
For further information: Media Inquiries: Tammy Smitham, External Communications, Pr@loblaw.ca; Investor Relations Inquiries: Roy MacDonald, Investor Relations, firstname.lastname@example.org