Struggling drugstore chain\u00a0Walgreens\u00a0is going private.\u00a0<\/p>\n
The company on Thursday said it\u00a0inked a deal\u00a0with private equity firm Sycamore Partners that will take it off the public market for an equity value of around $10 billion.<\/p>\n
Sycamore will pay $11.45 per share in cash for Walgreens. Shareholders could also receive up to $3 more per share in the future from sales of Walgreens\u2019 primary-care businesses, including Village Medical, Summit Health and CityMD. Walgreens said the total value of the transaction would be up to $23.7 billion when including debt and possible payouts down the line.<\/p>\n
Walgreens and Sycamore expect to close the take-private deal in the fourth quarter of this year. Shares of Walgreens jumped more than 5% in after-hours trading on Thursday before being halted.<\/p>\n
The historic deal ends Walgreens\u2019 tumultuous run as a public company, which began in 1927. As of Thursday morning, shares of the company were up more than 15% for 2025, but the stock was still down more than 48% for the last year and had fallen 70% for the past three years.\u00a0<\/p>\n
\u201cWhile we are making progress against our ambitious turnaround strategy, meaningful value creation will take time, focus and change that is better managed as a private company,\u201d Walgreens CEO Tim Wentworth, who stepped into the role in 2023, said in a release on Thursday. \u201cSycamore will provide us with the expertise and experience of a partner with a strong track record of successful retail turnarounds.<\/p>\n
Stefan Kaluzny, Sycamore\u2019s managing director, said in the release the transaction reflects the firm\u2019s confidence in Walgreens\u2019 \u201cpharmacy-led model and essential role in driving better outcomes for patients, customers and communities.\u201d<\/p>\n
Walgreens will maintain its headquarters in Chicago. The company currently has more than 310,000 employees globally and 12,500 retail pharmacy locations across the U.S., Europe\u00a0and\u00a0Latin America, according to the release. Walgreens still plans to release its second-quarter earnings on April 8.<\/p>\n
Walgreens\u2019s market value reached a peak of more than $100 billion in 2015 as investors gained confidence in its health-care business and expansion plans, making it one of the most prominent American retail companies.\u00a0<\/p>\n
But the company\u2019s market cap shrank to under $8 billion in late 2024 due to competition from its main rival CVS, grocery chains, big-box retailers and\u00a0Amazon, along with a slew of challenges. Walgreens has been squeezed by the transition out of the Covid pandemic, pharmacy reimbursement headwinds, softer consumer spending and a troubled push into health care.<\/p>\n
Both Walgreens and CVS have pivoted from years of store expansions to shuttering hundreds of retail pharmacy locations across the U.S. to shore up profits. But unlike CVS, which has diversified its business model by offering insurance and pharmacy benefits, Walgreens largely doubled down on its now-flailing retail pharmacy business.\u00a0<\/p>\n
In October, Walgreens said it plans to\u00a0close roughly 1,200 of its drugstores\u00a0over the next\u00a0three years, including 500 in fiscal 2025 alone. Walgreens has around 8,700 locations in the U.S., a quarter of which it says are unprofitable. The company has also scaled back its push into primary care by cutting its stake in\u00a0provider VillageMD.\u00a0<\/p>\n
Walgreens tapped health-care industry veteran Tim Wentworth as its new CEO in late 2023 to help regain its footing.\u00a0<\/p>\n
The company has reportedly been seen as a potential private equity target in the past.\u00a0<\/p>\n
In 2019, private equity firm KKR made a roughly\u00a0$70 billion buyout\u00a0offer to Walgreens, the Financial Times and Bloomberg reported at the time.\u00a0<\/p>\n<\/p>\n
Struggling drugstore chain\u00a0Walgreens\u00a0is going private.\u00a0 The company on Thursday said it\u00a0inked a deal\u00a0with private equity firm Sycamore Partners that will take it off the public market for an equity value of around $10 billion. Sycamore will pay $11.45 per share in cash for Walgreens. Shareholders could also receive up to $3 more per share in […]<\/p>\n","protected":false},"author":0,"featured_media":15723,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-15722","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/15722","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=15722"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/15722\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/15723"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=15722"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=15722"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=15722"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}