GCS to acquire FASA for $637 million

Grupo Casa Saba, S.A.B. de C.V. ("GCS") (NYSE: SAB) (BMV: SAB), and various Chilean legal entities that are controlled by Mr. José Codner Chijner, who is the final controller of Farmacias Ahumada S.A. ("FASA") (BCS: FASA) announced that they have reached a definitive agreement under which GCS will acquire the control of FASA in a transaction valued at approximately US$637 million, including the assumption of US$162 million in estimated net debt as of March 31, 2010.

Under the terms of the agreement and at the request of Mr. Codner, GCS will offer an all cash option tender for 100% of FASA common shares, which trade on the Bolsa de Comercio de Santiago, at a price of CLP 1,642 per share. The tender offer will be contingent upon the successful tender of at least 50.0% plus one of all FASA shares outstanding, and is expected to be financed through a mix of cash and new debt for which GCS has obtained firm commitments from HSBC.

The combined company, which will be consolidated under GCS, will become the leading drugstore chain in Latin America and one of the largest distributors of consumer and pharmaceutical products in the region, with estimated pro-forma revenues of approximately US$4 billion and a wide platform of c. 1500 drugstores across Mexico, Brazil, Chile and Peru.

Manuel Saba, Chairman of the Board of GCS, said, "This transformational transaction is of critical importance for GCS's strategic future and long-term prospects for value creation. We have spent years focused on building a best-in-class wholesale pharmaceutical distribution platform and preparing for the strategic expansion of our business across Latin America. We have successfully built a business model with clear and sustainable competitive advantages based on a deep, experienced and dedicated team and state-of-the art technology. The synergies, productivity gains, and organic growth prospects moving forward are staggering. At this defining moment, we look forward to forging a clear path for GCS to become the Latam bellwether in the space and to seek accretive organic and non-organic opportunities across the region and building upon the tremendous success that FASA and GCS have accomplished until now."

The transaction has been approved by the Boards of Directors of GCS and will be subject to the satisfactory completion of certain conditions. Such conditions include the approval of a majority of GCS shareholders, customary regulatory approvals (including the anti-trust authority in Mexico), and other customary closing conditions.

HSBC and Estructura Partners/Cicerone acted as joint financial advisors to GCS in connection with this transaction. The sellers were advised by Goldman Sachs & Co. and Servicios Financieros ALTIS S.A.