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Report: CVS offer to buy Brazilian chain declined
May 22nd, 2014
NEW YORK – CVS Caremark Corp. reportedly was rejected with a $2 billion offer to buy Brazilian drug store operator DPSP.
CVS, the second-largest U.S. drug chain with more than 7,600 stores, had made a formal proposal to buy DPSP for approximately 4.5 billion reais, or $2.03 billion, the Brazilian news website Exame.com reported.
DPSP, which was advised by Morgan Stanley, is Brazil's third-largest drug store retailer by store count, with more than 800 stores in the Drogaria Sao Paulo and Pacheco chains, published reports said.
A CVS Caremark spokesman declined to comment.
The Brazilian market recently has drawn increased attention from major pharmacy industry players.
In late March, AmerisourceBergen Corp. announced a deal to acquire a minority stake in Brazilian pharmaceutical wholesaler Profarma Distribuidora de Produtos Farmacêuticos S.A. and enter a joint venture with Profarma for specialty distribution and services. Last year, it became one of the largest mixed distributors in Latin America and the largest in Brazil with the acquisition of the retail chains Drogasmil/Farmalife and Tamoio, according to AmerisourceBergen. In the retail pharmacy market, Profarma is Brazil's 10th largest drug chain, with 140 stores in Rio de Janeiro.
Early last year, CVS Caremark announced that it closed a deal to acquire Drogaria Onofre, a Sao Paulo-based retail drug chain with 44 stores. Onofre is Brazil's eighth-largest drug chain by sales and has stores in Sao Paulo, Rio de Janeiro, Minas Gerais, Espirito Santo and Rio Grande do Sul states.
Another deal involving the South American market was unveiled earlier this month. Global pharmacy, health and beauty retailer and wholesaler Alliance Boots said it plans to acquire Farmacias Ahumada (FASA), the retail pharmacy business of Mexico-based Grupo Casa Saba S.A.B. de C.V. (Casa Saba). FASA operates two major Latin American drug chains: Farmacias Benavides in Mexico and Farmacias Ahumada in Chile. Alliance Boots said Farmacias Ahumada is one of the three largest drug chains in Chile, with about 400 stores.