Pointon Partners has handled the sale and purchase of dozens of pharmacies over the last fifteen years. We have considerable experience in acting for vendors of pharmacies as well as purchasers of pharmacies whether they be first time owners or pharmacists who operate already several pharmacy businesses.
We also cater to the day to day legal needs of our pharmacist clients whether it be employment law advice, leasing advice, review of franchise agreements & supplier contracts together with other advice and representation as required.
An emerging trend in recent years has been the sale and acquisition of part interests or minority interests in pharmacies generally involving employee pharmacists buying into the pharmacy they are currently working in.
Succession planning is often the motivating factor for the existing proprietor in these situations. The exact form of the transaction will depend upon the legal structure currently utilised by the pharmacy business.
If the pharmacy business is conducted:
- through a company, then a Share Sale Agreement will be prepared;
- through a unit trust, then a Unit Sale Agreement will be prepared; or
- By the existing proprietor in their own name, then a Sale of Assets Agreement will be prepared transferring a part interest in the business to the incoming owner.
It is also advisable to put in place a document regulating the ongoing relationship between the owners. This would be a Partnership Agreement, Shareholders Agreement or Unitholders Agreement as applicable.
We can prepare these on behalf of the existing owner or review and negotiate these on behalf of the incoming owner. On occasion the existing owner will have a service trust or company which is providing services (e.g. staff, premises or equipment) to the pharmacy business. The transaction will also need to involve the incoming owner acquiring an interest in this service trust or company.
The consent of any landlord to the new ownership arrangements is also something which needs to be addressed.
On a final note, the incoming owner will need to consider what legal structure they use to acquire their interest in the pharmacy business. The alternatives are buying the pharmacy interest in their own name, through a company or through a trust. Disclosure of these arrangements must be made to the Victorian Pharmacy Authority (VPA). We have experience in submitting documents to the VPA and preparing or amending trust deeds in order to meet the requirements of the VPA.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
