Neighbourly collects C$288m to fund Rubicon acquisition

Toronto-based pharmacies network Neighbourly Pharmacy, which went public last year, has raised about C$288 million from a public offering and private placement. About C$18 million was secured from additional shares acquired by Persistence Capital Partners, the company’s largest investor. The proceeds will be used to help fund Neighbourly’s C$435 million acquisition of Rubicon Pharmacies from TorQuest Partners.

PRESS RELEASE

TORONTO, April 14, 2022 /CNW/ – Neighbourly Pharmacy Inc. (TSX: NBLY) (“Neighbourly” or the “Company”), is pleased to announce that further to its news releases dated March 10, 2022 and March 18, 2022, Persistence Capital Partners (“PCP”), the Company’s largest shareholder, has exercised, in full, its option (the “Placement Over-Allotment Option”) to acquire 622,500 additional subscription receipts in the capital of Neighbourly (the “Placement Subscription Receipts”), at a price of $28.95 per Placement Subscription Receipt, for additional aggregate gross proceeds to the Company of approximately $18 million.

Aggregate gross proceeds from the previously announced public offering (including the exercise, in full, of the underwriters’ over-allotment option) and concurrent private placement of subscription receipts, combined with today’s exercise of the Placement Over-Allotment Option by PCP, total approximately $288 million and will contribute toward funding Neighbourly’s previously announced acquisition (the “Acquisition”) of Rubicon Pharmacies (“Rubicon”). Closing of the Acquisition remains subject to customary conditions for transactions of such nature, including the receipt of necessary third party consents and regulatory approvals. Neighbourly continues to expect the completion of the Acquisition to occur during the second quarter of calendar year 2022.

“We are excited to have the continued support and confidence of PCP. The Company remains well-capitalized post the Acquisition of Rubicon’s 100 locations. Our prudent capital structure provides us with significant incremental financing capacity and free cash flow available to continue to execute on our successful acquisition strategy. With a robust pipeline we feel strongly about our opportunities for continued growth,” stated Chris Gardner, Neighbourly’s Chief Executive Officer.

Following closing of the Placement Over-Allotment Option, and assuming the conversion of all the then outstanding subscription receipts, PCP and its affiliates would beneficially own or control, directly or indirectly, an aggregate of 21,985,922 common shares in the capital of Neighbourly, representing approximately 49.5% of the then issued and outstanding common shares of Neighbourly.

“Our ongoing investment in Neighbourly represents PCP’s commitment to supporting the Company’s acquisition and integration strategy with the Canadian pharmacy landscape continuing to offer a robust pipeline of compelling opportunities for future growth,” stated Stuart M. Elman, Managing Partner of PCP.

The Placement Subscription Receipts and the underlying common shares are subject to a four month hold period under applicable securities laws from the date of issuance of the subscription receipts.

About Neighbourly Pharmacy Inc.
Neighbourly is Canada’s largest and fastest growing network of community pharmacies. United by their patient first focus and their role as essential and trusted healthcare hubs within their communities, Neighbourly’s pharmacies strive to provide accessible healthcare with a personal touch. Since 2015, Neighbourly has expanded its diversified national footprint to include 271 locations (on a pro forma basis, after giving effect to the Acquisition), reinforcing the Company’s reputation as the industry’s acquirer of choice.