Snyder's buys Western Drug as it plans expansion in Montana

Drug Store News, Oct 16, 2000 by James Frederick

MINNETONKA, Minn. -- Ramping up its store growth as the U.S. expansion vehicle of Canadian drug store retailer The Katz Group, Snyder's Drug Stores has made its biggest acquisition in several years with the purchase of Western Drug, a chain of seven drug stores based in Billings, Mont. The acquisition, which closed in late September, marks Snyder's farthest move yet from its Minnesota operating base and its first foray into Montana.

"I am pleased that we were able to acquire Western Drug, as it puts us into a new market," said Snyder's president and chief executive Gordon Barker, who added that the addition of Western "will have a positive impact on our bottom line day one."

Barker said the chain is now looking for additional takeover candidates in Montana to consolidate its new holdings and beef up its presence in the Northwest. In addition, he said, "I am not ruling out the possibility that we could build stores in Montana as we are doing now in other areas."

All seven Western Drug stores operate in southern Montana. Western president and chief executive Clayton Pike called the sale "a win-win acquisition for Snyder's and The Katz Group as well as Western Drug employees and their customers. Western and Snyder operating in two different markets for the past 45 years have had a very similar past," Pike added. "We have both maintained a local perspective in the stores. The strong management team that Gordon Barker has put together at Snyder Drug, their merchandising group and financial strength will be a big plus for Western ... giving more Montanans a blend of Western! Snyder's dedication to healthcare service"

The Western purchase underscores Snyder's newfound financial muscle under The Katz Group, which operates nearly 400 drug stores in Canada and has made no secret of its plans to use Snyder's as a base for its drive into the U.S. market. In line with that effort, Snyder's also continues to build new market strength closer to home; its latest acquisition, also revealed late last month, is that of an independent, 15,000-square-foot drug store in White Bear Lake, Minn. that will operate under the Snyder's logo. That purchase comes fast on the heels of other acquisitions and new-store construction in the chain's home state.

The latest purchase brings Snyder's store count to 75. The chain also supports more than 100 independent drug stores in the upper Midwest and Northwest with distribution, buying and merchandising services.

"We are committed to secure Snyder's position as a top regional chain by opening new stores, acquiring individual stores and merging smaller chains into our operation," added John Greer, chief administrative officer.