Ritzman Pharmacy

Situation

Ritzman Pharmacy (“Ritzman”) was a community pharmacy chain started in 1955. Over the years it had grown to 24 stores. Ritzman’s margins and market share were under continual pressure due to the fact that Walgreens, CVS, and Rite Aid own approximately 67% of the market share in the United States.

Solution

Amherst was initially engaged by Ritzman Pharmacy in April 2016 to conduct an organizational review of their business and strategic plans. At the time, Ritzman was a commercial credit of their bank.

As a result of the review, the bank transferred the credit to their ABL floor, and the structure of the ABL loan was not going to allow Ritzman to fully execute their strategic plan.

Ritzman’s Board and Management then decided that refinancing the Company to a different lender was their best chance to allow them to execute their plan. Ritzman refinanced to their new lender in September 2016.

Results

Due to a continuation of market pressure making it difficult for community pharmacies in general, and ongoing consolidation in the industry, in December of 2017, Ritzman decided to sell the business.

Amherst was retained to sell the business and ran a sale process which included marketing it to both strategic and financial buyers.

In March 2019 the company sold to CVS Pharmacy and the sale allowed Ritzman to fully satisfy its creditors and return proceeds from the sale to the shareholders.