The high-street pharmacy chain Boots is undergoing a significant change in ownership, as it is being acquired by a private equity firm. This move will result in Boots no longer being a public company listed on a stock exchange. Walgreens Boots Alliance has entered into a $23.7 billion deal with private equity firm Sycamore Partners, as first reported by Sky News.
As a result of this acquisition, Boots will transition from being a company with publicly traded shares on the Nasdaq stock exchange in New York to being privately owned by a firm specializing in retail. Shareholders will receive $11.45 per share, with the potential to earn an additional $3 per share based on certain business sale conditions. Private equity firms typically acquire businesses, invest in improving their financial performance, and aim to sell them for a profit.
This change in ownership is not unique to Boots, as other high-street businesses such as Morrisons and Asda supermarkets have also been acquired by private equity firms. The impact of this acquisition on Boots shops in the UK remains uncertain, but it could potentially lead to a sale of that segment of the business by the new owners.
In 2023, Boots announced the closure of 300 stores, while Walgreens Boots Alliance has seen a significant decline in its share price value since 2015. Although there were previous considerations to sell off the Boots arm of the business from Walgreens Boots Alliance, these plans were abandoned in 2022 due to challenging conditions in debt-financing markets. Boots itself was acquired by Walgreens in 2014.
Established by John Boot in 1849, Walgreens Boots Alliance has a long history of providing herbal remedies. The company employs approximately 51,000 people in the UK across 1,800 pharmacies and opticians. The acquisition by a private equity firm has raised concerns among industry unions, with the Pharmacists’ Defence Association expressing worries about the implications of private equity ownership on pharmacists and employees.
The union has called upon the NHS and the General Pharmaceutical Council to ensure that any potential impacts on the community pharmacy network are managed effectively to maintain public access and uphold standards. The Union of Shop, Distributive and Allied Workers has been contacted for their input on this development.
As of now, Boots has not provided any comment on the acquisition.
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