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Walgreens Boots Alliance revealed on Thursday that it has entered into a $10 billion agreement to be acquired by Sycamore Partners, a private equity firm, marking a significant shift for the drugstore giant as it transitions to a private company. This strategic move comes amid ongoing struggles with declining sales and increasing operational costs, prompting Walgreens to seek a restructure away from the public market’s watchful eye.
The deal details indicate that Sycamore Partners will pay Walgreens shareholders $11.45 per share in cash, which presents an equity valuation of about $10 billion. Additional profits from the divestment of Walgreens’ primary-care assets could provide shareholders with an extra $3 per share, as reported by The Wall Street Journal.
Upon completion in the fourth quarter of 2025, the transaction—considering debts and potential payouts—could reach a total value of approximately $23.7 billion. Following the acquisition, Walgreens’ stock will be removed from the Nasdaq Stock Market, consolidating its operations as a private entity.
Since going public in 1927, Walgreens has struggled with significant financial headwinds over the past decade, witnessing its market capitalization decline from $100 billion in 2015 to roughly $9.8 billion currently. The company faced a staggering net loss of $8.6 billion for the fiscal year 2024, a figure that is three times the loss recorded in the previous year, as reported by The New York Times.
Related: ‘Changes Are Imminent’: Walgreens to Shutter a ‘Significant’ Number of Stores
At its peak in 2018, Walgreens operated nearly 9,500 locations in the U.S., but the company has since shut down about 1,000 stores and is currently planning to close an additional 1,200 stores as part of a cost-cutting initiative. During a recent earnings call, CEO Tim Wentworth noted that only 6,000 of its U.S. locations are currently profitable.
This acquisition by Sycamore Partners aims to provide Walgreens the operational flexibility needed to revamp its business strategies without the pressure of public accountability. “While we are making progress against our ambitious turnaround strategy, meaningful value creation will take time, focus, and change that is better managed as a private company,” Wentworth stated in a recent press release.
Moreover, Walgreens has been embroiled in legal issues recently. In June 2023, the company faced a lawsuit from Cooler Screens, an interactive display technology provider. The lawsuit claimed that Walgreens hindered the implementation of their ad-enabled digital cooler doors, violating a contract established in 2018. Walgreens has countered this assertion, suggesting that the technology posed significant operational challenges, such as malfunctioning screens and inaccuracies in product displays.
Related: Walgreens’ Battle Over High-Tech Cooler Doors Heats Up
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