McKesson Corp., San Francisco, has signed a definitive agreement to buy two business units and joint ownership of a pharmacy software program from the Katz Group, a privately owned drugstore operator based in Edmonton, Alberta, Canada. The deal is worth about $916 million (USD) and is expected to be funded primarily through available cash, according to a McKesson news release.

McKesson is proposing to buy substantially all of the assets of Drug Trading Co., a marketing and purchasing arm of the pharmacy network, and Medicine Shoppe Canada, a franchise pharmacy business. In addition, the company will take joint ownership in ProPharm, a software application that supports the pharmacy dispensary systems.

McKesson, which will continue to serve as the primary drug distributor for Katz Group corporate-owned stores, said the businesses will be integrated into the company's Canadian drug distribution and services business.

The deal is expected to close in the first half of this year.