Walgreens Boots Alliance has agreed to be acquired by private equity firm Sycamore Partners in a nearly $10 billion deal, aiming to revitalize the struggling retailer. The buyout will take Walgreens private, providing flexibility to restructure without Wall Street pressures. Shareholders may receive up to an additional $3 per share under specific conditions.
The pharmacy chain has faced financial struggles due to rising costs, shrinking prescription reimbursements, and increasing retail theft. As part of its turnaround strategy, Walgreens plans to close 1,200 of its 8,500 U.S. stores and has already scaled back its VillageMD clinic business.
This deal follows a challenging year where Walgreens’ stock lost nearly two-thirds of its value. The transaction price represents a 30% premium compared to December’s share price when acquisition rumors surfaced. Including debt, the total deal is valued at nearly $24 billion.
Walgreens has taken aggressive steps to cut costs, including suspending its dividend and reducing its stake in drug distributor Cencora. The company joins Rite Aid in moving away from public trading, leaving CVS, Walmart, and Kroger among the last major pharmacy operators still publicly traded.
