Galen G. Weston, Loblaw Companies Limited CEO address an annual general meeting. The company announced this week it is buying Lifemark Health Group, a health-care service provider that offers physiotherapy, massage therapy and more at 300 clinics across Canada.
Galen G. Weston, Loblaw Companies Limited CEO address an annual general meeting. The company announced this week it is buying Lifemark Health Group, a health-care service provider that offers physiotherapy, massage therapy and more at 300 clinics across Canada.
When he was 12, George Weston worked as a baker’s apprentice. He went on to become a bread route salesman and, by the early 1900s, earned a reputation for his “Weston’s Home-Made Bread” business — a triumph of enterprise that helped land him a seat on Toronto City Council.
Last October, Galen G. Weston — George’s great-grandson, who now runs Loblaw Companies Ltd. — sold the family’s centenarian bakery business, Weston Foods, and on Monday the company announced plans to fill the void with a new venture: Lifemark Health Group, a health-care service provider that offers physiotherapy, massage therapy and more at 300 clinics across Canada.
The $845-million acquisition is part of a new chapter in the company’s history, one that has seen the company rapidly expand into health services and technology as it spreads out across Canadian industries.
ARTICLE CONTINUES BELOW
ARTICLE CONTINUES BELOW
Plenty of legacy Canadian brands have waned over the years, but Loblaw has only grown bigger.
In the past decade, the company made a flurry of acquisitions and investments to build out its health services arm. After purchasing Shoppers Drug Mart in 2014, it acquired software firm QHR Corp. for $170 million in 2016 to provide electronic medical record-keeping for doctors. In 2020, it bought a minority stake in Maple Corp., a telemedicine provider, for $170 million.
Without Shoppers and Pharmaprix, Loblaw still owns a dizzying array of subsidiaries: No Frills, T&T Supermarket, Real Canadian Liquorstore, Real Canadian Superstore, Real Canadian Wholesale Club, Extra Foods, Valu-mart, ARZ Fine Foods, Dominion, Independent City Market, Freshmart, Atlantic Superstore, Provigo, Zehrs and Fortinos.
Then there are the brands — No Name, President’s Choice, Life Brand and Joe Fresh — and the real estate holdings: Choice Properties REIT, the largest real estate investment trust in Canada, and Canadian Real Estate Investment Trust, purchased for $3.9 billion in 2018.
More than ever, though, competition experts say Loblaw is quickly transforming into a technology behemoth that connects its retail and health ventures through online platforms that meticulously track consumer behaviour and shopping patterns.
“They’re not primarily a grocer anymore. Fundamentally, Loblaw is a tech-driven platform that just so happens to sell groceries and real estate,” said Vass Bednar, executive director of the Master of Public Policy in Digital Society program at McMaster University.
The purchase of Lifemark furthers Loblaw’s ambitions as a digital health provider, said Bednar.
The small-cap physical therapy company will be rolled into Shoppers Drug Mart. Already, as of a partnership from two years ago, Lifemark patients can book appointments through Shoppers’ PC Health app, which also allows users to access live chats with registered nurses and receive health-care referrals.
PC Health is connected with PC Optimum, the company’s loyalty program, which allocates points to customers who complete fitness challenges and purchase health items. The app has not merged with PC Express, Loblaw’s online grocery platform, but Bednar said she would not be surprised to see those platforms eventually converge.
“As Loblaw continues to deepen its integration across pharmacies, health, groceries and financial services, it builds a very sophisticated profile of individuals and micro-markets,” said Bednar.
ARTICLE CONTINUES BELOW
ARTICLE CONTINUES BELOW
“If I’m diabetic, or pregnant, I wonder if eventually I’ll get points through PC Health for eating sugar-free foods.”
By its own admission, the company has sought to become a one-stop shop for everyday essentials — from apples to Tylenol to, now, a back massage.
“The core of our connected health-care network is the digital properties or digital tools that we’re developing,” Shoppers president Jeff Leger previously told the Star.
The move to buy Lifemark also gives Shoppers and Loblaw a chance to roll-up the fragmented Canadian physiotherapy clinic sector, which has few — if any — dominant players.
The closest is probably Lifemark itself, according to a report from Desjardins Capital Markets, but the company earns an estimated $450 million annually in an $11 billion industry.
ARTICLE CONTINUES BELOW
ARTICLE CONTINUES BELOW
In a statement, the company said it hopes to expand that market share through a network of thousands of individual health-care professionals with “complementary expertise.”
“If Loblaw’s has an existing payment system and infrastructure for booking in place, they’re going to be a step ahead of smaller players that often use their own websites and third-party payment systems,” said Jennifer Quaid, a law professor at the University of Ottawa with a background in competition law.
“When you come into a new market with large-scale systems already in place, you can build out much faster.”
Jacob Lorinc Jacob Lorinc is a business reporter for the Star. He has previously reported for The Spectator and The Globe and Mail.
Anyone can read Conversations, but to contribute, you should be a registered Torstar account holder. If you do not yet have a Torstar account, you can create one now (it is free).
To join the conversation set a first and last name in your user profile.
Anyone can read Conversations, but to contribute, you should be a registered Torstar account holder. If you do not yet have a Torstar account, you can create one now (it is free).
To join the conversation set a first and last name in your user profile.
Sign in or register for free to join the Conversation