H. D. Smith to Acquire Northern California-based Valley Wholesale Drug
Acquisition Helps Company Reach Critical Mass in California, Doubling Independent Pharmacy Customer Reach in State
Springfield, Ill. – H. D. Smith, among the nation’s largest pharmaceutical wholesalers, today announced plans to acquire Valley Wholesale Drug in a merger agreement transaction. The acquisition provides H. D. Smith with an increased customer base in California, reaching more than 1,000 independent pharmacy customers in the state – approximately half of the California market. Additionally, Valley Wholesale Drug customers will benefit from access to H. D. Smith’s broader product, service and solutions portfolio through its national network of distribution facilities and sales teams. The acquisition also provides H. D. Smith the opportunity to expand into the Pacific Northwest, an underserved region and marketplace for the company.
“Today’s announcement serves as an important building block in our national customer service vision – to continue our commitment to meeting the needs of independent community pharmacies – and serve a growing number of these customers throughout the important state of California,” said Dale Smith, chairman and chief executive officer, H. D. Smith. “As we have since our founding in 1954, H. D. Smith will continue to focus on exceptional service to our core customers – the Retail Independent Pharmacy. This acquisition confirms our commitment to assisting this vital link in the chain of the U.S. health system to address consumer health community needs.”
Following the close of the acquisition, Valley Wholesale Drug customers will benefit from H. D. Smith’s broader product portfolio and solutions, including the Company’s Third Party Network, a PSAO, that will enable Valley pharmacies to strengthen their payor and customer connections.
“Becoming part of the H. D. Smith family of companies aligns two companies with many similarities, including their family founded and owned pedigrees, focus on delivering high-quality products and service value to customers and their service to a similar customer base mix – largely independent pharmacies and institutional accounts,” said Stephen J. Shoneff, chief executive officer, Valley Wholesale Drug. “We believe this is an outstanding fit for Valley Wholesale Drug and its customers, who seek customer service and support programs that contribute exponentially to the Independent Pharmacy's profitability, viability and rightful place in today's health care system.”
In recent years, H. D. Smith has embarked on a national expansion effort to increase its independent pharmacy and institutional customer base and expand service offerings to customers across the nation. Since 1995, the Company has acquired regional distribution players or built distribution centers in seven states serving key regions, including Texas, Illinois, California, New York Metro, Florida, New England and Kentucky.
About H. D. Smith
Headquartered in Springfield, Illinois, H. D. Smith is among the largest national full-line, full-service wholesalers providing a complete line of pharmaceuticals, OTCs, HBAs, home healthcare products, durable medical equipment, seasonal merchandise and a wide array of marketing programs to retail pharmacies, regional chains and health systems. The company has distribution facilities in California, Florida, Kentucky, Illinois, New Hampshire, New Jersey and Texas that service major markets throughout the United States. Additional information about H. D. Smith can be found at hdsmith.com. Assisting H. D. Smith with this deal were Schiff Hardin LLP, legal advisors and Mueller Prost as financial advisors.
About Valley Wholesale Drug
Valley Wholesale Drug is a family owned regional healthcare distributor serving over 600 independent pharmacy and institutional customers in California with a few in Nevada. Valley also has distribution licensing in the state of Washington. The Company’s headquarters and sole distribution center are in Stockton, California and it currently employs 75 associates, 10 of which are sales associates. Valley Wholesale Drug also brings strong operational and financial performance to the H. D. Smith family of companies – in 2011 the Company achieved $130 million in annual revenue. Assisting Valley Wholesale Drug with this deal was Ernst & Young Capital Advisors, LLC, as financial advisor.