(Reuters) – Proxy advisory firm Ownership Matters said on Monday it recommends Sigma Healthcare shareholders vote in favor of the drug company’s reverse takeover by Chemist Warehouse, citing significant shareholder value.
Sigma Healthcare will hold a shareholder meeting on Jan. 29 to seek approval for the deal, which will create a $5.8 billion entity.
As part of the deal, which was announced in December 2023, Chemist Warehouse will buy Sigma for shares and A$700 million in cash, giving it an approximately 85% stake in the merged entity and a backdoor to listing on the Australian stock exchange .
In early November, Australia’s competition regulator approved the deal after the companies made concessions to address competition concerns.
Sigma Healthcare shares have risen more than 300% since the deal was announced. It was last down 1.2% at A$2,965.
(Reporting by John Biju in Bengaluru; Editing by Sonia Cheema)