👉 Background: Chemist Warehouse has grown to to over 630 stores and over 20,000 employees in the last 20 years. Last December, it announced plans to join forces with Sigma Healthcare in an $8.8 billion reverse takeover — which is still subject to approval from the ACCC.

👉 What happened: Late last week, Chemist Warehouse announced potentially its last financial results as a private company. And, they didn’t disappoint. It announced a full year profit of over $539 million — that’s up from $302 million the year before.

👉 What else: Sigma Healthcare also announced big results late last week: their net profits, excluding costs for the merger were up over 300%. And with both companies rolling in profits, the question is—will these juicy numbers change the merger terms, if it actually gets the ACCC approval?

What's the key learning?

💡As time stretches on, it can force a rethink on the terms of a pending merger - especially when the financial performance of the companies involved have changed significantly during the waiting period.

💡As a quick refresher, the original terms of the deal would give Sigma Healthcare shareholders 14% share of the combined company. But since the merger was announced, its share price has jumped over 130% - so who knows if time may also change the terms of this mega-pharma-takeover!

💡This wouldn't be the first time the terms of a merger has changed. For example, the merger between major US telcos, T-Mobile and Sprint, took two years for regulatory approval. And by 2020, when it got approval, Sprint's financial health deteriorated - so the revised deal gave T-Mobile more favourable terms.