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Competition Commission and Competition Tribunal give green light to Netcare outsourcing agreement with Clicks

Healthcare group Netcare and pharmacy retail group Clicks

Friday, November 11 2016

Healthcare group Netcare and pharmacy retail group Clicks today announced that the Competition Commission and Competition Tribunal have approved the long-term agreement which they entered into on 8 June 2016, whereby Netcare will outsource its 37 retail pharmacies in Medicross medical and dental centres and 45 Netcare hospital retail front shop operations to Clicks.

Richard Friedland, chief executive officer of Netcare, said: “Netcare is continuously exploring ways to improve our service delivery. Affiliating the pharmacy and front shops to an experienced retail provider of Clicks’ stature will enable us to provide an enhanced retail offering to patients, consumers and other stakeholders.”

Clicks will assume control of all Medicross pharmacies on 1 December 2016 and the 45 retail front shops of the Netcare hospital division on 1 February 2017. The agreement excludes the dispensing of prescriptions in the Netcare hospital pharmacies, which remain within Netcare’s hospital operations.

David Kneale, chief executive officer of Clicks Group, said: “Our outsourcing agreement with Netcare will enable Clicks to expand its presence and make our pharmacy chain even more accessible and convenient to our customers. As part of the implementation process the Medicross pharmacies and Netcare front shops will be rebranded to Clicks. This is a strategically important agreement for Clicks and we look forward to a long-term mutually beneficial partnership with Netcare.”

Friedland and Kneale confirmed that specific staff members involved in Medicross and the retail front shops in the hospitals will be transferred to Clicks on terms similar to their current conditions of employment. Netcare and Medicross staff members indirectly affected will remain in the business on their current conditions of employment, thus confirming that there would be no loss of jobs as a result of the transaction.

The outsourcing agreement will have no material impact on the earnings and financial positions of either company.

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Ends

Notes to journalists

Netcare (JSE: NTC) is listed on the JSE and has a market capitalisation of R55 billion (at 10 November 2016). Netcare is ranked 16th overall on the JSE, in the 2016, Top 100 Most Empowered JSE Listed Companies Report and has also been included in the FTSE Russell Top 30 Index.

In South Africa, Netcare operates the largest private hospital, primary healthcare, emergency medical services and renal care networks. In addition to its world class acute private hospital services in South Africa and the United Kingdom (the latter offered through BMI Healthcare), Netcare provides:

  • primary healthcare services, occupational health and employee wellness services through Medicross and Prime Cure;
  • emergency medical services through Netcare 911; and
  • renal dialysis through National Renal Care.

Netcare also has the distinction of being a leading private trainer of emergency medical and nursing personnel in the country.

Netcare’s core value is care. From this value flow four others, namely dignity, participation, truth and passion. We work hard to entrench these values in every action, decision and intervention we take with our patients, their families, our colleagues and communities.

For more information visit www.netcare.co.za

Clicks is South Africa’s leading pharmacy, health and beauty retailer with over 500 conveniently located stores. Clicks has the largest retail pharmacy chain with over 400 in-store dispensaries, complemented by 195 primary care clinics.

Clicks is the main operating business of JSE-listed Clicks Group (JSE: CLS). The group has a portfolio of market-leading retail brands Clicks, The Body Shop, GNC, Claire's and Musica, and also owns UPD which is South Africa's leading full-range national pharmaceutical wholesaler.

For more information visit www.clicksgroup.co.za

Media enquiries:
Netcare: Martina Nicholson 083 631 6647
Clicks Group: Graeme Lillie 082 468 1507

Issued by:      Martina Nicholson Associates (MNA) on behalf of Netcare and Clicks
Contact:         Martina Nicholson, Graeme Swinney or Meggan Saville 
Telephone:      011 469 3016
Email:             martina@mnapr.co.za, graeme@mnapr.co.za, or meggan@mnapr.co.za

The Netcare Group. Providing YOU with the best and safest care