Walgreens offers 10 million shares of AmerisourceBergen Corp

USA — Walgreens Boots Alliance Inc., a pharmacy, health care, and beauty products provider, has begun an offering of 10 million shares of AmerisourceBergen Corp. common stock.

AmerisourceBergen has authorized a US$500 million share repurchase in conjunction with the initial public offering.

After the sale, Walgreens Boots Alliance’s ownership of AmerisourceBergen’s common stock will decrease from approximately 26% to approximately 20%, the company said.

Walgreens Boots Alliance intends to use the proceeds primarily for debt paydown and the continued support of the company’s strategic priorities, including acquisitions.

In addition to distribution and logistics, AmerisourceBergen helps pharmaceutical manufacturers bring their products to market.

It also has a division that distributes drugs for veterinarians, livestock producers, and manufacturers to make a meaningful difference in their businesses and the health of animals.

AmerisourceBergen Corp. slumped Tuesday Walgreens Boots Alliance Inc. sold about US$2 billion of its remaining stake in the company through an overnight secondary offering and a corporate buyback, Bloomberg reported.

The distributor of generic pharmaceuticals and other health-care products fell as much as 4.4% after Walgreens unloaded 10 million shares in a stock offering — a position worth US$1.6 billion based on Monday’s closing price — plus about US$500 million of shares in a buyback.

The deal represents the largest US secondary offering by a selling holder since Jan. 4, according to data compiled by Bloomberg, when Tencent Holdings Ltd. sold US$3 billion of its stake in Sea Ltd.

Large stake sales have been limited for most of the year as lower stock prices and higher volatility created a buyers’ market.

Holders have unloaded just US$11 billion in stock through US secondary offerings this year, an 85% decrease from this point in 2021.

This isn’t the first time Walgreens has trimmed its AmerisourceBergen position. The company sold six million shares at US$150 each in May, according to a statement, raising US$900 million primarily to repay debt.

Walgreens held 52.9 million shares in AmerisourceBergen, a 25.5% stake, as of Aug. 2, according to data compiled by Bloomberg.

In January 2021, AmerisourceBergen Corporation acquired Walgreens’ Alliance Healthcare, one of Europe’s largest drug wholesalers for the amount of US$6.3 billion in cash and 2 million shares of AmerisourceBergen common stock.

Acquiring Alliance Healthcare will provide even stronger support for pharmacies and pharmacists across the world and integrate solutions for pharmaceutical manufacturers.

The deal will particularly grow AmerisourceBergen’s distribution network globally. The acquisition excluded Alliance’s businesses in Germany, Italy, and China.

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