WBA calls off Boots sale over ‘dramatic change’ in financial markets
Boots UK parent company Walgreens Boots Alliance has abandoned plans to offload the UK’s largest community pharmacy multiple after the last remaining bidder was unable to meet its target price.
WBA said this afternoon (June 28) that because of “unexpected and dramatic change” in the financial markets, it was calling off the sale process and retaining ownership of Boots.
Indian conglomerate Reliance Industries and private equity firm Apollo had teamed up to submit a binding offer, but reportedly struggled to source the capital needed to fund a takeover.
WBA said today: “As a result of market instability severely impacting financing availability, no third party has been able to make an offer that adequately reflects the high potential value of Boots and No7 Beauty Company.
“Consequently, WBA has decided that it is in the best interest of shareholders to keep focusing on the further growth and profitability of the two businesses.
“The decision to retain the businesses has also been supported by the ongoing strong performance and growth of Boots and No7 Beauty Company, which have exceeded expectations despite challenging conditions.”
WBA said it would “continue investing in the future of these two businesses”. It declined to comment on whether it plans to resume the sale process once the market is more stable when approached by Pharmacy Network News.
CEO Rosalind Brewer commented: “We have now completed a thorough review of Boots and No7 Beauty Company, with the outcome reflecting rapidly evolving and challenging financial market conditions beyond our control.
“It is an exciting time for these businesses, which are uniquely positioned to continue to capture future opportunities presented by the growing healthcare and beauty markets.
“The Board and I remain confident that Boots and No7 Beauty Company hold strong fundamental value, and longer term, we will stay open to all opportunities to maximize shareholder value for these businesses and across our company.”
WBA is due to announce its latest quarterly earnings on Thursday.