Walgreens to Be Acquired by Sycamore Partners for $10 Billion

The transaction is valued at up to $23.7 billion, including equity value, debt, and payouts, according to the companies.

A woman walks past a Walgreens at the corner of Sunset and Vine in the Hollywood neighborhood of Los Angeles on Jan. 15, 2013. Kevork Djansezian/Getty Images

Walgreens Boots Alliance announced on Thursday that it has agreed to be acquired by private equity firm Sycamore Partners for $10 billion.

The price is a fraction of the $100 billion the pharmacy chain was worth a decade ago.

The companies have entered into an agreement under which Walgreens shareholders will receive $11.45 per share in cash at the closing of the Sycamore transaction, according to a press release.

The deal will also include a non-transferable right for shareholders to receive up to $3.00 in cash from the future monetization of Walgreens’s debt and equity interests in VillageMD, which includes Village Medical, Summit Health, and CityMD—the pharmacy chain’s primary care businesses.

The transaction is valued at up to $23.7 billion, including equity value, debt, and payouts, according to the companies. Walgreens’s common stock will be delisted from the Nasdaq Stock Market, and the company will transition to private ownership once the transaction is completed.

Walgreens CEO Tim Wentworth said in a statement that the company was making progress with its turnaround strategy, but “meaningful value creation will take time, focus and change that is better managed as a private company.”

Wentworth said the company has been navigating the challenges of “a rapidly evolving pharmacy industry” and an “increasingly complex and competitive retail landscape.”

“Sycamore will provide us with the expertise and experience of a partner with a strong track record of successful retail turnarounds,” he said. “The WBA Board considered all these factors in evaluating this transaction, and we believe this agreement provides shareholders premium cash value, with the ability to benefit from additional value creation going forward from monetization of the VillageMD businesses.”

Walgreens said it plans to keep its headquarters in Chicago and continue to support the communities in which it operates. The company will retain its name and consumer brands after the takeover.

The transaction is expected to be completed in the fourth quarter of this year, pending approval from Walgreens shareholders and the receipt of required regulatory approvals.

“The transaction is not subject to a financing condition, and Sycamore has received fully committed financing for the transaction,” the company stated, adding that the deal was unanimously approved by Walgreens’ board of directors.

Troubled Times

The pharmacy chain currently employs 312,000 people in 12,000 stores in eight countries, according to its website, a sharp decline from the 25 countries, 450,000 employees and 21,000 stores it had four years ago.

Its fortunes collapsed as drug margins fell and as consumers turned to cheaper rivals such as Amazon and Walmart to fill their prescriptions and purchase toiletries.

Walgreens has been grappling with reduced cash flow, with more than half of its $7 billion in net debt maturing next year. It has been closing thousands of stores and embarked on a $1 billion cost-cutting program aimed at streamlining operations amid financial pressures.

The company announced last year that it was planning to close about 1,200 stores in the following three years, including approximately 500 in fiscal year 2025, to gain immediate accretive to adjusted EPS (earnings per share) and more cash flow.

In February, Walgreens closed 12 stores in San Francisco, citing “increased regulatory and reimbursement pressures” that have strained its ability to cover rent and other operational costs.

“It is never an easy decision to close a store. We know that our stores are important to the communities that we serve, and therefore do everything possible to improve the store’s performance,” a Walgreens spokesperson told The Epoch Times.

The Walgreens buyout deal came after competitor Rite Aid announced in September 2024 that it would operate as a private company after completing a Chapter 11 bankruptcy reorganization and financial restructuring. Rite Aid slashed about $2 billion debt and received approximately $2.5 billion in exit financing to support the business going forward, the company stated.

Lear Zhou and Reuters contributed to this report.