Listed healthcare and animal products company Ebos plans to buy into an Australian pharmacy chain to take advantage of a rationalisation of the sector there.
Ebos will merge its own Chemmart pharmacy stores with the Terry White Group chain, and then take a 50 percent stake in the enlarged group, which would have about 500 stores and turnover of about $2 billion.
The deal would cost Ebos around $18 million and will be funded from cash flow and existing debt facilities.
Ebos chief executive Patrick Davies said the impact on the company's earnings would be modest but the deal would lay the foundation for growth.
"This entity will be well resourced, it's a pharmacy focused retail brand in a market place that is growing and will see further consolidation and we want to be a part of that, we think it has a very nice strategic fit for our shareholders and for our company longer term."
Last November, Ebos bought a well-known natural health goods manufacturer, Red Seal, for $80m, and Mr Davies said the company remained on the lookout for businesses that would fit.