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Irish Times
23-05-2025
- Business
- Irish Times
Uniphar says lawsuit is designed to ‘damage' its reputation
Healthcare group Uniphar has said claims made in the High Court that it breached an agreement and abused its dominant market position to take over a pharmacy broker business are designed to publicly damage its reputation. The Dublin-listed group, which owns and operates large Irish pharmacy brands including Life and Hickey's, is the defendant in a lawsuit taken by Dublin-based Thera Pharmaceuticals. The Irish Times reported on Thursday that Thera Pharmaceuticals, part of the Navi group, is suing Uniphar in the High Court, seeking several remedies, including the restoration of its broker account. In a statement on Friday morning, Uniphar said it is 'disappointed' with 'unilateral stance' Thera has taken in the High Court action and 'categorically' rejects the allegations. READ MORE 'We honour our contractual obligations at all times, and we consider Navi's recent actions as designed to publicly damage our reputation and prevent or delay Uniphar from offering improved terms to customers in the market, in competition with Navi,' it said. 'Our customers remain our first priority and we will continue to provide the highest levels of service to them while we seek to address the allegations and defend our good name through the courts.' At issue in the case is an agreement between the group and Thera, which provides infrastructure allowing pharmacies to buy products from wholesalers like Uniphar, which Thera has claimed was unilaterally breached by the larger group. The deterioration in relations between the businesses followed Uniphar's takeover bid of Navi, which was blocked by the Competition and Consumer Protection Commission in 2021 because it would substantially lessen competition in the markets. In an affidavit opened in court this week, Thera founder and director John Carroll said his company has had a brokerage agreement with Uniphar Wholesale since 2015. He claimed Uniphar, however, has its own electronic ordering platform that competes with his company's. Mr Carroll said Uniphar had, in recent times, made unilateral changes to its agreement, including the blocking of Thera's trading account. Uniphar is also attempting to manufacture, in breach of the agreement, a large €3.49 million liability designed to destabilise Thera, he alleged. Uniphar is also attempting to force certain pharmacies to route all their purchases through it or face being cut off at the end of the month, Mr Carroll said, adding that the defendants have made 'a strategic decision' to launch a multifaceted attack on the brokerage agreement and the business relationship to try to take over Thera's business and seeks to abuse its dominant position.
Yahoo
17-05-2025
- Business
- Yahoo
Does Dick's $2.4B Foot Locker Buyout Justify a Buy Decision Today?
DICK'S Sporting Goods, Inc. DKS is acquiring another big athletic footwear retailer Foot Locker, Inc. FL. Will this impact Dick's Sporting Goods' focus and business alignment? Should you consider buying DKS stock now? Let's find out – Dick's Sporting Goods, recently, decided to acquire Foot Locker for almost $2.4 billion. In the buyout deal, Foot Locker shareholders may receive $24 in cash or 0.1168 shares of Dick's common stock in place of each share held. The cash offer is 66% higher than Foot Locker's 60-day average price. Dick's Sporting Goods plans to finance the deal through a combination of new debt and cash. Both parties expect the transactions to be completed by mid-2025. The acquisition is expected to boost earnings per share (EPS) in the first full fiscal year after closing and generate $100-125 million in cost synergies in the medium term, added Dick's Sporting Goods. Dick's Sporting Goods chairman Ed Stack stated that the merger would enable both athletic footwear retailers to unlock growth and strengthen their position among shoe enthusiasts. The acquisition of Foot Locker would consolidate Dick's Sporting Goods' market position in the footwear industry, providing the company with the capability to perform on a larger scale. Lest we forget, Foot Locker had around 2,400 stores in 26 countries by the end of last year. Dick's Sporting Goods agreed to buy Foot Locker at a high price, causing Foot Locker's shares to soar 85% on Thursday, its largest increase ever. And why not? Foot Locker received a significant payout, a silver lining for the company whose shares had plummeted 70% since reaching a high of $79.20 on Dec. 8, 2016. Over the last three fiscal years, Foot Locker's revenue growth was lackluster, with earnings falling from $7.77 in fiscal January 2022 to $1.37 by the end of January this year. Foot Locker's market share is also shrinking. And these challenges unnerved Dick's Sporting Goods investors, causing a 14.6% drop in DKS share price on Thursday. While Dick's Sporting Goods has increased market share, improved profitability, and thrived in a tariff environment, acquiring a struggling retailer has dampened investor enthusiasm. Understandably, Dick's plans to expand its footwear business, which made up 28% of total sales in fiscal 2024. But acquiring a stressed company at a high price has fueled doubts about Dick's Sporting Goods' future. It may decrease the return on capital and heighten balance sheet risk for the company. Investors are feeling uneasy about Dick's Sporting Goods' beaten-down Foot Locker acquisition amid uncertain macroeconomic conditions and elevated selling, general, and administrative expenses. Therefore, new entrants should avoid betting on Dick's Sporting Goods stock for now. However, existing stakeholders may consider holding onto it as there are potential growth opportunities if management gets the synergy right. Dick's Sporting Goods, anyhow, is seeing strong top-line growth, increase in comparable store sales, and transaction growth. For now, Dick's Sporting Goods has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Foot Locker, Inc. (FL) : Free Stock Analysis Report DICK'S Sporting Goods, Inc. (DKS) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
