Adbrands Weekly Update 29th Oct 2015: Pharmacy giant Walgreens Boots Alliance is to acquire competitor Rite Aid for $9.4bn, or $17.2bn including the smaller company's debt. Walgreens is already the biggest pharmacy chain in the US, with 8,200 outlets. It also controls the Boots pharmacy business in the UK and other markets, as well as an extensive wholesale business. Main US rival CVS Health has 7,800 stores but is significantly bigger by revenues - almost $140bn last year - as a result of its substantial Caremark prescription management division. The acquisition of Rite Aid's 4,600 drugstores in 31 US states creates a group with around 13,000 outlets (though some overlapping stores may be closed) and combined sales of close to $130bn. Separately, Walgreens Boots reported results for the year to August. Revenues soared 35% to $103.4bn as a result of the consolidation of Alliance Boots, while net earnings more than doubled to $4.2bn.
Adbrands Weekly Update 8th Jan 2015:
Walgreens and Alliance Boots completed their merger on the last day on 2014 to create Walgreens Boots Alliance. The resulting business will continue to operate the three separate brands of Walgreens pharmacies in the US, Boots high street pharmacies in the UK (an a few other markets)
and the Alliance Healthcare wholesale network. Pro forma consolidated sales for the merged group are around $110bn.
Adbrands Weekly Update 18th Dec 2014:
Walgreens' CEO Greg Wasson announced plans to retire following completion of the buyout of the outstanding shares in European pharmacy group Alliance Boots in Feb next year. Instead, the smaller company's chairman and controlling shareholder Stefano Pessina will step up to become
interim CEO of the merged group. He will also be the single largest shareholder in the expanded Walgreens Boots Alliance, with 20% of equity, worth around $13bn.
Adbrands Weekly Update 7th Aug 2014:
US pharmacy giant Walgreen has confirmed plans to take full control of its UK counterpart Alliance Boots earlier than expected. It will acquire the 55% of Boots it doesn't already own in February next year, at a cost of around £5bn in cash and shares. One unexpected turn is that it will
not proceed with a corporate inversion to shift its financial base to Europe. That controversial loophole, in which US companies relocate to countries offering lower corporation taxes, is already under scrutiny by US regulators and is likely to be closed. Walgreen's CEO said the board had decided
against such a move because of the likelihood of drawn-out negotiations with US regulators. However its eagerness to be a good corporate citizen didn't play well with shareholders, who had been looking forward to higher dividends. The newly created Walgreen Boots Alliance will continue to be
headquartered in Chicago, with Walgreens CEO Greg Wasson at its head. Alliance Boots executive chairman and controlling shareholder Stefano Pessina will be its single largest shareholder with an 18% stake worth more than $10bn.
Adbrands Weekly Update 22nd May 2014:
US pharmacy giant Walgreens is said to be weighing up a plan to reverse into its 45%-owned European partner Alliance Boots, in order to shift its tax base out of the US. Alliance Boots, which controls an extensive pharmaceutical wholesale network across Europe, as
well as pharmacy retailer Boots, reported strong performance for its latest financial year to March. Net profits jumped by 31% to £971m on revenues up 4% to £23.4bn. The strongest performance came from wholesaling, with revenues up 4.8%, compared to 2.4% in health & beauty
retail. Walgreens has an option to acquire the 55% stake in Alliance Boots it doesn't already own from February 2015.
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