Loblaw Companies Ltd. announced on Monday that its Shoppers Drug Market unit is buying Lifemark Health Group in an $845-million all-cash deal.

Lifemark provides physiotherapy and massage therapy, among other services, at more than 300 clinics across Canada.

“By joining Shoppers, Lifemark will continue to grow as a national health and wellness network,” said Lifemark Chief Executive Peter Stymiest in a release.

Details about Lifemark’s financial performance were not provided by Loblaw; however, Desjardins Capital Markets Analyst Chris Li told clients he estimates the outpatient service provider generates approximately $400 million of annual revenue. He has a hold recommendation on Loblaw, and a price target of $110.00 per share.

“Lifemark adds to Shoppers’ growing role as a healthcare service provider, with a network of health and wellness solutions,” Li wrote in his report. “Physical therapy services are a continuum of primary healthcare services and a natural extension to [Loblaw’s] Connected Healthcare strategy into adjacent healthcare verticals.”

Li estimates Lifemark has “mid-single-digit” market share of the $11-billion physiotherapy and rehabilitation industry. He added that he doesn’t think the acquisition will interfere with Loblaw’s ability to buy back shares. Li expects Loblaw will repurchase approximately $1 billion of its shares this year, compared to a $1.2-billion buyback last year.

Vishal Shreedhar, an analyst at National Bank of Canada Financial Services, raised his price target on Loblaw to $119.00 per share from $111.00 after the deal was announced Monday, and told clients he thinks Lifemark will boost Loblaw’s annual earnings per share around two per cent. Shreedhar maintained his outperform recommendation (the equivalent of a buy).

The purchase of Lifemark requires regulatory approvals, and is expected to close in the second quarter of this year, Loblaw said in its release.