Boots sale on cards as owner looks to US
Boots could be sold or put on the market by the end of the year as US parent company bosses face tremendous pressure to break up the global pharmacy giant
Boots could be sold or floated by the end of the year as bosses at its US parent company face enormous pressure to break up the global pharma giant.
Investors and board members want Stefano Pessina, executive chairman of the Walgreens Boots Alliance, and CEO Rosalind Brewer to accelerate plans to refocus the company on the US.
They want Walgreens to spin off its global businesses as soon as possible, said industry experts, who view Boots and other operations in Europe as a “distraction.”
The 81-year-old Pessina, who was the architect of the two deals that brought Boots Alliance and Walgreens together in 2012 and 2014, would still favor splitting the company, but would be less eager to rush.
The Italian businessman was CEO of the group until 2021, when he was replaced by former Starbucks boss Brewer.
Tussle: WBA boss Rosalind Brewer, right, tried to sell Boots last year
It would be the second time Walgreens has attempted to divest Boots in as many years. The parent company put Boots up for sale in January 2022 with a price tag of £7 billion, but this was called off in June after a suitable buyer was not found.
Walgreens as a whole is worth £23 billion in the US stock market.
Investors and board members want the company to focus on a new strategy that includes Walgreens – America’s second largest pharmacy chain – moving away from traditional retail and focusing more on US private health care. It is increasingly becoming a healthcare provider with billion-dollar investments in companies like VillageMD and Summit Health.
Boots has been struggling for years. The 174-year-old British chain lost £58 million in the year to August 2021, compared to a loss of £278 million during the pandemic when it was also forced to cut thousands of jobs.
Boots employs approximately 53,000 people in the UK and Ireland and operates more than 2,200 stores. Its history dates back to 1849, when farm laborer and Quaker John Boot opened a herbal medicine shop in Nottingham.
Any sale of Boots would likely be considered by ministers and regulators as the company plays a vital role in providing public health care across Britain.
But a stock exchange listing could also be in the offing.
The city would probably insist that Walgreens float Boots in London, rather than New York.