Celesio owner McKesson has agreed to purchase the pharmaceutical distribution division of UDG Healthcare PLC, in a £297.4 million deal, the US firm has announced.

Under the terms of the agreement American company will acquire United Drug and United Drug Sangers, a leading wholesaler across the Republic of Ireland and Northern Ireland, TCP, a leading home healthcare provider in the Republic of Ireland and MASTA, UDG’s travel healthcare business based in the United Kingdom.

“The acquisition of UDG’s pharmaceutical distribution, home and travel healthcare businesses in Ireland and the UK, will strengthen our position in the industry. We have made this investment as part of our growth strategy which leverages the positive trajectory of the wider healthcare sector in Europe,” said Marc Owen, chairman of the Management Board at Celesio AG.

More than 1,000 UDG employees will join McKesson as part of the acquisition, forming part of McKesson’s International Pharmaceutical Distribution and Services business.

The announcement follows McKesson’s recent agreement to acquire 281 pharmacies operated by Sainsbury’s in the UK. Both the UDG and Sainsbury’s acquisitions are due to be completed in the first half of 2016.

UDG announced also announced that chief executive Liam FitzGerald would retire in March 2016 and named chief operating officer Brendan McAtamney as their new CEO.