Purchase of outstanding minority stake in Rx Systems Limited (“Rx”)

01 Nov 2018

EMIS Group is pleased to announce that it has acquired the outstanding minority stake in its subsidiary Rx, which trades as EMIS Health Community Pharmacy, giving the Group 100% control of the business.

The 21.1% minority stake was acquired from Phoenix Medical Supplies Limited (“Phoenix”), the leading pharmaceutical wholesaler, which has held its stake since before EMIS Group acquired 78.9% of Rx in 2010. Phoenix, which owns more than 500 pharmacies in the UK, is a significant user of Rx's systems and services, and is expected to remain an important customer of the Group going forward.

The consideration for the purchase is £8.0 million in cash, which has been funded out of EMIS Group’s existing cash reserves. Prior to completion, Rx paid a dividend to its shareholders of £19.0 million from its accumulated reserves, of which £4.0 million was paid to Phoenix with the balance retained within the Group.

For the year ended 31 December 2017, Rx contributed revenues of £21.9 million and a segmental operating profit of £5.6 million to the Group.  The transaction is expected to be immediately earnings enhancing for EMIS.

Commenting on the purchase, EMIS Group CEO Andy Thorburn said:

“Rx has been an important contributor to EMIS Group since 2010 and Phoenix a valued partner, co-investor and customer throughout that period. We are pleased to have come to this agreement and to consolidate full control of Rx which, as the market-leading community pharmacy solution, remains central to the Group’s strategy of providing connected healthcare software and services across every major UK healthcare setting.”