Walgreens is America's largest drugstore chain by revenues, and also now the leader by store outlets, as a result of a series of regional acquisitions, including the famous Duane Reade drugstore chain in New York, added in 2010. (Competitor CVS/Caremark is bigger by total revenues because of its large pharmacy benefits management division). Walgreens has come to position itself as the "front line" for the delivery of healthcare services in the US, with an expanding networking of in-pharmacy and worksite healthcare clinics, offering diagnosis and treatment for minor ailments. However it also sells a broad range of non-healthcare products, giving it a growing presence in the convenience store segment. In 2012, the group made a big jump into Europe, agreeing to acquire an initial 45% stake in local retailer and wholesaler Alliance Boots. It bought out the remaining shares slightly earlier than expected, at the very end of 2014. A year later, the group unveiled a $17.2bn bid for US rival Rite Aid, that will consolidate Walgreens as the dominant drugstore chain in the US.
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Adbrands Weekly Update 16th Jun 2016: Simon Roberts, group EVP of pharmacy giant Walgreens Boots Alliance and local president of Boots in the UK, has resigned his role " to pursue new opportunities". The chain denied any connection to a Guardian newspaper investigation earlier this year. This alleged that Boots pharmacy managers had been encouraged to boost profits by offering medical health checks to customers who didn't need them (and even to other staff) in order to claim cash rebates from the National Health Service. Boots denied this was the case. Roberts' departure has prompted a full overhaul of group senior management, with EVPs Alex Gourlay and Ornella Barra elevated to co-COOs. Gourlay will continue to oversee the Walgreens and Boots chains, with Barra responsible for global wholesale and group corporate services. Boots' former marketing director Elizabeth Fagan was named as Roberts' effective successor, becoming managing director of Boots. Ken Murphy becomes EVP & group chief commercial officer.
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.
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