Sweden sells part of retail pharmacy monopoly

Sweden auctioned off part of its Apoteket retail pharmacy monopoly for 5.9bi crowns (US$844.5m) as part of the government’s plan to roll back state ownership.

Since coming to power in 2006, the centre-right coalition government has sold several chunks of an extensive corporate empire, including vodka maker Vin & Sprit, real estate firm Vasakronan and part of telecoms operator TeliaSonera.

Sweden has also begun to open up the gaming and betting market. However, Swedes continue to have to buy wine and spirits from the state monopoly, Systembolaget.

Apoteket, which serves about 315,000 customers a day, sold 28.4bn crowns of medicine to private individuals and 3bn crowns of other merchandise in 2008. Swedes have had to buy their drugs exclusively from the group since 1970.

The government’s plan was to sell more than 960 of a total of 916 outlets in a first phase, with another 150 to be sold to small business owners later. The state will keep the remainder.

Finland’s Oriola-KD Oyj said on Monday it was one of the buyers, acquiring 171 pharmacies for about 1.56bn crowns in cash. These stores had sales of 4.4bn crowns.

Nordic private equity specialist Altor will buy 208 pharmacies generating revenue of 7.1bn crowns. Sweden’s Segulah AB, which also focuses on the region, is buying 62 pharmacies. Investor AB (INVEb.ST), a listed Swedish investment firm, and Priveq Investment AB are together buying 24 drugstores with a turnover of 1.4bn crowns.

The Financial Times reported on Monday that Alliance Boots, Europe’s largest pharmacy group, had bid for two large tranches of businesses in the auction. But Sweden did not list the group as among the successful bidders.