Shareholders of Walgreens Boots Alliance overwhelmingly approved the drugstore chain’s $10 billion acquisition by private equity firm Sycamore.
It is a rough era for national pharmacy chains like Walgreens, CVS, and Rite-Aid, closing hundreds of stores due to changing consumer behavior, declining pharmacy reimbursements and rising costs. Walgreens will close more than 1,000 stores through 2027 and Rite-Aid filed for bankruptcy protection in May, it’s second trip to bankruptcy court in as many years.
Walgreens shareholders will receive $11.45 per share from Sycamore Partners per the terms of the deal first announced in March, the companies said Friday. They could also receive as much as an additional $3 per share from the future monetization of Walgreens’ debt and equity interests in its VillageMD clinic business.
The buyout, which will take the drugstore chain private, will give it more flexibility to make changes to improve its business without worrying about Wall Street’s reaction. Walgreens was founded in 1901 and has been a public company since 1927.
‘’With Sycamore’s partnership, we will be better positioned to accelerate our turnaround strategy,’’ said Walgreens CEO Tim Wentworth.
Walgreens shares were largely unchanged by Friday’s news, hovering around $11.50, as they have since the deal was announced. Just two years ago, they were worth more than $30 each.
Last fall, the company announced a plan to close 1,200 of its roughly 8,500 U.S. locations.
The company, based just north of Chicago in Deerfield, Illinois, had already shed about a thousand U.S. stores since it grew to nearly 9,500 after buying some Rite Aid locations in 2018.
