Andlauer Healthcare Group Announces Agreement to Acquire 100% of Logistics Support Unit

February 10, 2022

TORONTO, Feb. 10, 2022 /CNW/ – Andlauer Healthcare Group Inc. (TSX: AND) ("AHG" or the "Company") today announced that it has entered into a definitive agreement to acquire 100% of Logistics Support Unit (LSU) Inc. ("LSU") for total aggregate consideration of approximately C$30 million, subject to customary purchase price adjustments (the "Acquisition"). AHG expects the Acquisition to be immediately accretive to cash flow and earnings per share and to expand its market presence in Québec.

Established in 2008, LSU is a third-party logistics provider offering specialty pharmacy, warehousing, distribution and order management services throughout Canada to national and international companies as well as government clients in the pharmaceutical, medical and biotechnology sectors. LSU is also the exclusive distributor of immunizing agents for the Québec public health system.

"After many years working together, we are thrilled to announce this strategic transaction with LSU’s business and leadership team, who we hold in very high regard," stated Michael Andlauer, Chief Executive Officer of AHG. "LSU is a leading third party logistics provider dedicated to the healthcare sector in Québec, and this acquisition will strengthen our service offerings and significantly expand our presence in the province. I am excited to welcome the LSU team to Andlauer Healthcare Group and look forward to working with them to continue the LSU brand and legacy under the AHG umbrella."

"We are delighted to join the Andlauer team," stated Johanne Bissonnette, President of LSU. "For the past 12 years, LSU has operated under private ownership, offering third party logistics services within the healthcare industry, where we have built a reputation for being a flexible, customizable and scalable logistics provider. LSU sought a partner who values their people, culture and customers, and we are confident this strategic transaction with AHG will allow for our continued growth and will positively serve the needs of our current and future customers." 

AHG will pay consideration of C$30 million for 100% of the shares of LSU, subject to customary purchase price adjustments. The consideration will consist of approximately C$22.5 million in cash, to be financed through a combination of cash on hand and by drawing on the Company’s credit facilities, and C$7.5 million in AHG subordinate voting shares, which will be subject to a post-closing hold period.

Closing of the Acquisition is subject to various closing conditions, including the receipt of TSX approval in connection with the issuance of the AHG subordinate voting shares. The Acquisition is expected to close on or around March 1, 2022.

Advisors 

Goodmans LLP is acting as legal counsel to AHG and JGW Business and Tax Law Inc. is acting as legal counsel to LSU.

About LSU

LSU is a first class provider of third-party logistics ("3PL") services exclusively for the pharmaceutical, medical and biotechnology sectors and is also an exclusive distributor of immunizing agents for the Québec public health system. LSU’s mission is to integrate optimal logistical solutions by providing expertise and quality services in the areas of customer service, warehousing and distribution, tailored to the needs of every client. For more information on LSU, please visit: http://www.logisticslsu.com 

About AHG

AHG is a leading and growing supply chain management company offering a robust platform of customized 3PL and specialized transportation solutions for the healthcare sector. The Company’s 3PL services include customized logistics, distribution and packaging solutions for healthcare manufacturers across Canada. AHG’s specialized transportation services in Canada, including air freight forwarding, ground transportation, dedicated delivery and last mile services, provide a one-stop shop for clients’ healthcare transportation needs. Through its complementary service offerings, available across a coast-to-coast distribution network, AHG strives to accommodate the full range of its clients’ specialized supply chain needs on an integrated and efficient basis. The Company also provides specialized ground transportation services, primarily to the healthcare sector, across the 48 contiguous U.S. states. For more information on AHG, please visit: www.andlauerhealthcare.com 

Forward Looking Information

This press release contains "forward-looking information" and "forward-looking statements" (collectively, "forward-looking information") within the meaning of applicable securities laws, including statements regarding the timing and completion of the proposed Acquisition, the receipt of TSX approval for the issuance of subordinate voting shares in connection with the Acquisition and the anticipated benefits of the Acquisition (including the extent to which they will be accretive). In some cases, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "targets", "expects", "is expected", "an opportunity exists", "budget", "scheduled", "estimates", "outlook", "forecasts", "projection", "prospects", "strategy", "intends", "anticipates", "believes", or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or, "will", "occur" or "be achieved", and similar words or the negative of these terms and similar terminology. In addition, any statements that refer to expectations, intentions, projections or other characterizations of future events or circumstances contain forward-looking information.

Statements containing forward-looking information are not historical facts but instead represent management’s expectations, estimates and projections regarding future events or circumstances. This forward-looking information is based on our opinions, estimates and assumptions that, while considered by the Company to be appropriate and reasonable as of the date of this press release, are subject to known and unknown risks, uncertainties, and other factors that may cause the actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information, including but not limited to: the risk that the acquired company will not perform in accordance with expectations and past history; the risk that all conditions to completion of the Acquisition (including regulatory approvals and third party consents) will not be satisfied or waived; the risk that the acquired company may not be efficiently integrated or that synergies will not be realized; and those other risks discussed in greater detail under the "Risk Factors" section of our Annual Information Form which is available under our profile on SEDAR at www.sedar.com. If any of these risks or uncertainties materialize, or if the opinions, estimates or assumptions underlying the forward-looking information prove incorrect, actual results or future events might vary materially from those anticipated in the forward-looking information. Although we have attempted to identify important risk factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other risk factors not presently known to us or that we presently believe are not material that could also cause actual results or future events to differ materially from those expressed in such forward-looking information.

There can be no assurance that forward-looking statements will prove to be accurate as actual outcomes and results may differ materially from those expressed in these forward-looking statements. Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, these forward-looking statements are made as of the date of this news release and, except as expressly required by applicable law, AHG assumes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

All of the forward-looking information contained in this press release is expressly qualified by the foregoing cautionary statements.

SOURCE Andlauer Healthcare Group Inc.

For further information: Peter Bromley, Chief Financial Officer, Tel: (416) 744-4900; Bruce Wigle, Investor Relations, Tel: (647) 496-7856