Overview of Sigma Healthcare's ASX announcement

Sigma Healthcare Limited (ASX:SIG) has revealed plans for a Retail Entitlement Offer and a proposed merger with Chemist Warehouse Group (CWG). The Retail Entitlement Offer involves a 1 for 1.85 accelerated non-renounceable pro rata entitlement offer of new fully paid ordinary shares at an offer price of $0.70 per new share. The offer is open to eligible retail shareholders and is expected to close on 19 January 2024. The proposed merger with CWG aims to create a leading healthcare wholesaler, distributor, and retail pharmacy franchisor, subject to various conditions including regulatory approvals and shareholder consent.

Executive commentary on the proposed merger and equity raising

The company plans to conduct an Entitlement Offer, which is fully underwritten by Goldman Sachs Australia Pty Ltd. HMC, the manager of Sigma's Major Shareholder, has provided a priority sub-underwriting commitment for $76 million. The Entitlement Offer will allow eligible institutional and retail shareholders to subscribe for new Sigma shares at a discounted price. Sigma also provided a trading update for FY24 YTD, reporting positive growth in wholesale sales and cost management. The company will host an investor call and has notified ASX of the Proposed Merger.

Overview of Sigma Healthcare's announcement and outlook

Sigma Healthcare Limited has announced a Retail Entitlement Offer and a proposed merger with Chemist Warehouse Group, aiming to create a leading healthcare wholesaler, distributor, and retail pharmacy franchisor. The Retail Entitlement Offer is fully underwritten and aims to raise funds for increased working capital required for the new Chemist Warehouse supply contract and business growth initiatives. The proposed merger with CWG is subject to various conditions, including regulatory approvals and shareholder consent. The announcement also provides insights into the detailed terms and conditions of the Merger Implementation Agreement between Sigma Healthcare Limited and Chemist Warehouse Group, outlining the obligations and responsibilities of both parties in relation to the proposed merger.