Irwin Mitchell Advises On Acquisition As Family Firm Targets Uk Expansion

Redditch-based leading pharmaceutical distributor and retailer, Lexon (UK) Limited, has acquired Norchem Limited for an undisclosed sum.

The family-run business, which has a turnover of £150 million and employs over 400 members of staff, purchased the Norchem group of companies in a strategic move in order to grow its retail operation and expand its distribution network which already includes fully automated warehouses in Redditch and Leeds.

Based in Ferryhill, County Durham, Norchem Limited was formed as a buying group in 1960 by six independent pharmacists. Today, as well as the wholesale business, the company has 20 retail outlets across the North East.

The deal, which has been backed by the Royal Bank of Scotland (RBS) and RBS Invoice Finance in Birmingham, takes the total number of pharmacies operated by Lexon and associated businesses to 46.

Following the deal, the current management team at Norchem will remain in place.

Pritesh Sonpal, director at Lexon, said: “We’re extremely pleased to conclude this deal as it represents a step change for Lexon.

“It builds on our existing distribution network and importantly, it will give us the ability to further improve our service to the existing 1,400 independent pharmacies that we already serve.”

Alison Herdman, chairman of Norchem, commented: “I am delighted that Lexon has acquired the business as they have demonstrated to us their long term commitment, not only to the retail stores, but more importantly to independent pharmacy. This has been the core principle of the business from its beginning.”

Nick Dawson, corporate partner at the Birmingham office of national law firm Irwin Mitchell, supported by Senior Associate, Rob Laugharne, advised Lexon on the deal.  Jon Bew and Natalie Barnes provided banking advice to Lexon.

Commenting on the deal, Nick Dawson said:

Expert Opinion

Lexon is a great example of a successful family run business which has a clear vision and is determined to grow and build market share. It is already one of the leading pharmaceutical distributors in the UK and this deal will significantly boost its position.” Nick Dawson - Partner

Richard Newman, relationship director for RBS, worked alongside Chris Lewis, the bank’s director of structured finance, and David Chick of RBS Invoice Finance.

Richard Newman, relationship director for RBS, said: “We are proud to be able to provide Lexon with a bespoke facility to support the growth of the business. This acquisition represents a transformational step forward for Lexon and a fantastic opportunity to further enhance what is already an excellent operating model. Having supported Lexon for 14 years, we’re delighted to be a part of the firm’s continued development. We wish the Lexon team every success in extending their enterprise value.”

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