Walgreens looking to sell, spin off Boots pharmacy outlets in the U.K.: Report

USA – According to a Forbes report, Walgreens Boots Alliance may be looking to sell its Boots pharmacies in the United Kingdom, with private equity firms likely to be the recipients.

Bain Capital reportedly approached Walgreens months ago about taking over Boots, but Walgreens declined to comment.

According to the report, Walgreens has also been considering other options for its more than 2,000 Boots pharmacies, including various spin-off options.

The report on the UK business comes as Walgreens spends billions of dollars on its drugstore operations in the United States under the direction of new CEO Roz Brewer.

Walgreens recently increased its investment in VillageMD by US$5.2 billion to accelerate the expansion of doctor-staffed clinics across the United States under a new “Walgreens Health” business.

According to Walgreens and VillageMD, they are “on track to open 1,000 primary care practices by 2027.”

Walgreens’ new management has recently invested significantly more in the company’s operations in the United States.

Walgreens is not alone in expanding its presence in health care. CVS Health’s in-store MinuteClinics provide walk-in urgent care services.

In addition, the chain is converting more of its locations to its HealthHub format, which includes expanded MinuteClinic services. Also, Walmart Health, a freestanding health care format, is expanding.

Brewer has high hopes for the much larger US business and believes it has the potential to help remake the American healthcare experience.

Imagine a day when 45% of our Walgreens stores — of the 9,100 stores that happen to be within five miles of 75% of the homes across the United States — where you can walk in and see a primary care physician that’s attached to a Walgreens drugstore,” Brewer said in an interview during the Forbes Healthcare Summit.

According to the Financial Times, the pharmacy retailer is putting advisors in place, including Goldman Sachs, to explore options for Boots, though it was still in its early stages as of early December.

Boots employs approximately 55,000 people across its 2,200 stores in the United Kingdom. While Boots’ valuation is likely to be in the tens of billions of pounds, it could be the largest deal in the United Kingdom since the 15 billion-pound Asda-J Sainsbury merger was canceled in 2019.

Walgreens acquired the U.K.-based pharmacy chain in two stages beginning in 2012, with a 45 percent equity stake in Alliance Boots.

In 2014, it completed the process by acquiring the remaining shares of the company to form Walgreens Boots Alliance.

However, Walgreens has recently invested in operations in Europe and around the world.

Walgreens Boots Alliance and McKesson Corporation announced earlier this week that they had reached an agreement for Walgreens to acquire the remaining 30% stake in their GEHE Pharma Handel and Alliance Healthcare Deutschland joint venture in Germany.

“As a result of this transaction, WBA will become the sole owner of the combined GEHE and Alliance Healthcare businesses in Germany,” the companies announced.

Walgreens operates approximately 13,000 retail locations in the United States, Europe, and Latin America.

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