Loblaw recieves approval to acquire Shoppers
Loblaw has said that it has recieved an approval for its $12.4 billion plan to acquire Shoppers Drug Mart Corp.
The country's Competition Bureau has granted an approval to the company following an agreement with the company, under which it has agreed to sell 18 stores and nine in store pharmacies.
The approval is subjected to some conditions related to how the retailer deals with its suppliers. The deal, under which two retail gaints in Canada will be merged into one giant player in the country, was announced on Friday.
The deal comes with the minimal number of store sales. The deal between the Bureau and Loblaw also imposes behavioural restrictions on the agreements with its suppliers. The conditions are aimed at preventing vendors from getting unfair treatment from large firms.
Retail giants are increasing vendor fees, fees suppliers are charged by retailers for shelf placement, promotions and marketing programs in order to increase margins as competition increases in the market.
"Through the analysis of the proposed merger transaction, the Bureau has been made aware of certain conduct by Loblaw with respect to its suppliers that could raise concerns under the Competition Act," the Bureau said in a statement.