Boots owner Walgreens explores $10bn sale to US private equity giant

Boots’ US owner Walgreens Boots Alliance (WBA), is reportedly in discussions with American private equity giant Sycamore Partners on a potential takeover in a deal which could value the health and beauty group at up to $10bn (£7.8bn).

It is understood that Sycamore Partners would seek separate ownership for UK subsidiary Boots if it does succeed in taking WBA private – potentially triggering a fresh auction for the British high street giant.

The talks follow a steep decline in Walgreens’ share price, which has dropped from over $100bn in 2015 to just $7.5bn in recent months. News of the discussions, first reported by The Wall Street Journal, led to a 20% surge in Walgreens’ shares during late trading on Tuesday (11 December).

Sycamore, which owns US stationery chain Staples, has a track record of investments in UK retail, including past stakes in Kurt Geiger and offers for Ted Baker in 2022. But it is considered unlikely that Sycamore would acquire Walgreens in its entirety, given its recent focus on smaller deals.



Walgreens’ billionaire chairman and largest shareholder Stefano Pessina, may end up as the principal owner of Boots depending on the deal’s structure, according to Sky News. Pessina, which owns a 17% stake in WBA, has been a key figure in Walgreens’ acquisitions over the past two decades.

WBA operates approximately 12,500 pharmacies globally, including 1,900 Boots stores in the UK. However, the US-based company has explored selling or spinning off its Boots operations a number of times in recent years as it has faced pressure to concentrate on its domestic market.

Back in 2022, WBA attempted to sell the Boots for an estimated £7bn but abandoned the plan, deciding that offers from firms including Apollo Global Management undervalued the retailer.

Earlier this year, the company revisited the idea of a sale or UK listing but shelved those plans in June, citing its strategic value and cash flow contributions. Weeks later, Boots managing director Seb James announced his resignation, as the retailer promoted ex-Asda MD Anthony Hemmerdinger to the role.

While Walgreens reported an $8.6bn net loss in its latest financial year and continues to struggle with sluggish US consumer spending and low reimbursement rates for drugs, Boots has shown relative resilience.

Sales in stores rose 6.2% in the quarter ending August, driven by higher footfall in city centres and travel hubs. Pharmacy growth increased 10% year-on-year, supported by demand for NHS and private healthcare services.

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