UPDATE 1-Loblaw-Shoppers deal approved by Canada's Competition Bureau

Fri Mar 21, 2014 10:46am EDT
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(Adds details on approval, background)

By Euan Rocha

TORONTO, March 21 (Reuters) - Loblaw Cos Ltd, Canada's largest grocer, said on Friday Canada's competition watchdog has approved its C$12.4 billion ($11 billion) acquisition of Shoppers Drug Mart Corp, the country's biggest pharmacy chain.

The deal cements Loblaw's No. 1 position in Canada at a time when competition from domestic retailers such as Sobeys and U.S. retailers such as Wal-Mart Stores and Target is heating up.

To win approval from the Competition Bureau, Loblaw has agreed to sell 18 stores and nine pharmacy operations. The company said it does not expect any store closures as a result of these divestitures.

Loblaw said it now expects the deal to close on March 28.

The majority of the stores and pharmacy outlets being sold are in Ontario, but the deal will also result in Loblaw's sale of stores in the Alberta, New Brunswick, Nova Scotia and other provinces.