June 22, 2017 / 5:24 AM / 7 months ago

UPDATE 2-Online pharmacy Zur Rose launches IPO to fund expansion

* Swiss online drug store aims to raise 230 mln Swiss francs

* Proceeds for German marketing, Swiss shops, takeovers

* Zur Rose boosted by EU court decision on German pricing (Adds comment from CEO, details)

By John Miller

ZURICH, June 22 (Reuters) - Online pharmacy Zur Rose Group aims to raise up to 230 million Swiss francs ($237 million) through an initial share sale, the company said on Thursday, to help it expand in Germany, open new shops and possibly make acquisitions.

The initial public offering (IPO) will be priced in range of 120 francs to 140 francs per share, valuing the company founded by Swiss doctors in 1993 at between 780 million francs and 870 million francs, Zur Rose said.

Zur Rose will use the proceeds to boost TV advertising in Germany, its largest market, as well as for its shop-in-shop concept with Swiss grocery chain Migros which kicks off with its first location next month.

Acquisitions elsewhere in Europe are also on the horizon, with an undisclosed target slated to be bought this year, said the company, which was set up to help doctors manage the cost of the medicines they distribute through their practices.

“Europe is an untapped market when it comes to online sales of pharmaceutical products,” Chief Executive Walter Oberhaensli told reporters in Zurich. “It would be negligent to wait to take advantage of these opportunities.”

Zur Rose, which had 2016 sales of 879.5 million francs, gained an anchor shareholder last year when the Swiss Frey family’s Corisol vehicle paid 40 million francs for a 20 percent stake. Saudi Arabia’s Al Faisaliah Group has 6.1 percent.

Trading in Zur Rose shares is set to start on July 6

The liberalisation of European Union pharmacy markets offers chances for further international expansion that Zur Rose aims to serve from its DocMorris logistics centre on the German-Dutch border.


Zur Rose also got help from last October’s European Court of Justice decision that a German law fixing prescription drug prices violated EU free trade rules.

After the decision, Zur Rose’s DocMorris division resumed offering financial incentives for German residents who order drugs online, helping DocMorris’s revenue increase 17 percent in the first quarter of 2017.

“We want to take advantage of the momentum created by the court ruling,” Oberhaensli said.

Among its competitors is Germany’s Shop Apotheke, which last year raised about 100 million euros ($112.6 million) in an IPO to fund its own expansion plans.

Zur Rose will be the second Swiss pharmacy company to list shares this year. Galenica Sante’s listing in April was Europe’s largest IPO of 2017 so far.

UBS and Berenberg are joint coordinators and joint bookrunners, with Zuercher Kantonalbank co-lead manager. (Editing by Michael Shields and David Clarke)

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