Sigma Healthcare Ltd (ASX: SIG) shares are rising on Wednesday morning.
At the time of writing, the pharmacy chain operator's shares are up 1.5% to $2.86.
This latest gain means that its shares are now up almost 190% since the start of the year.
Why are Sigma shares rising?
Investors have been buying the company's shares today after it provided an update on its proposed merger with Chemist Warehouse.
According to the release, the company expects the documentation shareholders require to vote on certain resolutions in connection with the proposed merger with Chemist Warehouse to be released this calendar year.
This means that if all goes to plan, the implementation of the merger is expected to occur in February 2025.
Though, if it takes a touch longer, it won't be an issue. That's because the company also notes that following the ACCC's decision in November to not oppose the merger, subject to accepting an undertaking provided by Sigma, the two parties have agreed to extend the end date under the merger implementation agreement for the transaction to 31 March 2025.
The only key outstanding conditions precedent for the transaction are now the approval of certain resolutions in connection with the transaction by Sigma shareholders, the approval of the scheme by Chemist Warehouse shareholders, and the approval of the court.
The next thing for Sigma shareholders to look out for is the notice of meeting for the extraordinary general meeting where the merger vote will take place. It notes that this will include detailed information on the transaction, the merged group, and how shareholders may attend and participate in the meeting.
Will it be worth the wait?
Sigma certainly believes the merger will be worth the wait.
A year ago today when the plans were announced, Sigma chair, Michael Sammells, said:
The Proposed Merger is a step-change event for Sigma. With Sigma having had a commercial relationship with CWG and its founders spanning more than 40 years, we are excited by the efficiencies, synergies and growth opportunities that we anticipate being unlocked through the merger of the two complementary businesses. The combined group will have extensive capabilities and expertise to benefit franchisees and customers, including through more brand choice, products and services and expanded marketing capabilities.
This sentiment was echoed by Chemist Warehouse's chair, Jack Gance. He said:
The combination of CWG's retailing and marketing capabilities and Sigma's state-of-the-art distribution infrastructure and logistics capabilities presents a unique opportunity for both CWG and Sigma shareholders. We look forward to building the next chapter of CWG's success for the benefit of our customers, staff, franchisees and shareholders.
