Breaking News
Investing Pro 0
NEW! Get Actionable Insights with InvestingPro+ Try 7 Days Free

Walgreens shelves pharmacy Boots' sale as market turmoil hits dealmaking

Economy Jun 28, 2022 10:56AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: People walk by a Walgreens, owned by the Walgreens Boots Alliance, Inc., in Manhattan, New York City, U.S., November 26, 2021. REUTERS/Andrew Kelly

(Reuters) - Walgreens Boots Alliance (NASDAQ:WBA) on Tuesday scrapped the plan to sell its UK high street pharmacy chain, Boots, saying no third party was able to make an adequate offer due to the turmoil in global financial markets.

Walgreens' move to call off the sale comes as private equity bidders Apollo Global and TDR faced headwinds in raising financing for the deal, several sources told Reuters, as banks were wary of underwriting large chunks of the financing due to tough market conditions.

Boots was initially valued at as much as 8 billion pounds, or $10.88 billion, with the auction process being led by Goldman Sachs (NYSE:GS), sources told Reuters in February.

Global economic uncertainty and rising inflation have triggered a spike in interest rates as central banks have rushed to take action in the most widespread tightening of monetary policy for more than two decades, making deal financing costlier and harder to access.

In Britain, supermarket chain Morrisons' 7-billion-pound takeover by U.S. buyout fund CD&R is the most notable debt financing deal to have hit a snag due to a delay in raising $6.6 billion in debt to fund the deal.

Walgreens had put its Boots business up for sale after announcing a strategic review in January as the second-largest U.S. pharmacy chain renewed its focus on domestic healthcare.

The company said the decision to retain Boots and No7 Beauty Company was also underpinned by their ongoing strong performance.

Brokerage Evercore ISI said the announcement was not a surprise, noting it was likely disappointing to the management team that had hoped to refocus the company on its U.S. pharmacy and healthcare businesses.

"We see a potential future sale as still likely within the next few years if macro environment becomes more stable," Evercore said in its note.

The 173-year-old Boots business includes 2,200 stores in the United Kingdom, including pharmacies, health and beauty stores.

Walgreens shelves pharmacy Boots' sale as market turmoil hits dealmaking
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email