Walgreens pulls out of the Boots sale following market volatility

• After putting Boots for sale in January, Walgreens claimed to have received numerous proposals.
• Mukesh Ambani and Apollo Global Management were reportedly interested purchasers.
• The company was valued at around £9 billion when it announced its merger in 2014.

According to US pharmacy behemoth Walgreens, purchasers of Boots were unable to acquire sufficient financing because of the unpredictability of the financial markets.

After putting Boots up for sale in January, Walgreens claimed to have received numerous proposals for the drugstore sector.

However, it claimed that none of the proposals sufficiently reflected the UK pharmacy chain’s high potential worth.

The Walgreens Boots Alliance said that it would continue to sell Boots and the No7 cosmetics line.

Indian billionaire Mukesh Ambani and US buyout company Apollo Global Management were reportedly interested purchasers. Their offer valued the company at roughly £5 billion.

The company was valued at around £9 billion when Walgreens and Boots announced their merger in 2014.

Following a “unexpected and significant reversal” in the financial markets, Walgreens stated that it had abandoned plans to sell Boots.

Also Read

Joe Biden announces US military reinforcements in Europe

NATO will be "strengthened in all directions across every domain," Biden says....

According to the statement, “no third party has been able to submit an offer that sufficiently reflects the significant potential value of Boots and No7 Beauty Company due to market volatility adversely limiting financing availability.”

“We have now finished a thorough examination of Boots and No7 Beauty Company, with the decision reflecting quickly shifting and tough financial market conditions outside our control,” said Rosalind Brewer, chief executive of Walgreens Boots Alliance.

“These firms are in an exciting period because they are specially situated to take advantage of opportunities that the expanding healthcare and beauty markets will bring in the future.

“The board and I remain convinced in the strong intrinsic value that Boots and No7 Beauty Group have, and over the long term, we will remain open to all alternatives to maximise shareholder value for both businesses and across our company.”

According to retail expert Catherine Shuttleworth, Walgreens sought more for Boots than potential buyers were willing to offer.

She responded, “Boots needs a lot of work.”

In the current market, she claimed, it would have been challenging to raise the money to buy it, and Boots has “substantial” pension liabilities.

She stated that one of the biggest obstacles for Boots is that customers can purchase comparable goods from rival businesses like supermarkets and internet retailers.

Additionally, Boots used to receive a lot of “lunchtime business” from people who worked in offices in city centres, but now more people were working remotely.

2,200 UK-based Boots locations are part of the company’s 173-year history.

As the Covid-19 pandemic hurt sales in 2020, Walgreens closed some of its stores and slashed 4,000 workers at Boots.

Also Read

US business worried after abortion ruling

Executives are caught between their fear of reprisals and employees' reliance on...