Shoppers Drug Mart Closes Largest IPO of 2001

Shoppers Drug Mart Inc., Canada’s largest drug store group, completed an initial public offering of its common shares on November 21, 2001. The offering was $540 million and will be increased to $594 million if the “green shoe” is exercised in full.

Proceeds from the initial public offering will be used to repay indebtedness of the company incurred in connection with a leveraged buyout completed in February 2000 by a group of institutional shareholders led by Kohlberg Kravis Roberts & Co. In connection with the offering, the company also implemented a significant directed share programme for certain company and store employees enabling them to purchase up to an aggregate of 1.5 million common shares at the IPO price.

Shoppers Drug Mart was represented by Bryna Goldberg, executive vice-president and general counsel, with assistance from Richard Alderson and Barbara Ruddy, vice-president; and by a team from Osler, Hoskin & Harcourt LLP comprised of Mark DesLauriers, Clay Horner, Sivan Fox, Stephen Solursh and Dana Easthope, with assistance from Art Peltomaa (research) and Firoz Ahmed, Julie Lee and Lara Friedlander (tax). Darrell Stephenson and Rod Gould of Stewart McKelvey Stirling Scales acted as New Brunswick counsel to the company.

CIBC World Markets Inc. led the syndicate, which also included Scotia Capital Inc., Merrill Lynch Canada Inc., Credit Suisse First Boston Corporation, RBC Dominion Securities Inc. and UBS Bunting Warburg Inc. The group of underwriters was represented by Bob Richardson, vice-president, associate general counsel and group head of CIBC World Markets; and by a team from Torys LLP that included Jamie Scarlett, Sharon Pel, Kevin Morris, Adam Armstrong, Graham Rawlinson, Tom Zverina and Corrado Cardarelli (tax) in Toronto, and Andy Beck and Geoff Gilbert in New York.