Key takeout
Shares in Walgreens Boots Alliance (WBA) surged about 5% in pre-market transactions on Tuesday, as a report showed the problematic drugstore chain is private with Sycamore Partners for around $10 billion.
Citing those familiar with the issue, drugstore companies and private equity companies are targeting the closing of the transaction as soon as they ban “last-minute obstacles” that derail the transaction on Thursday. The journal reports that Sycamore will pay $11.30 per share and $11.40 per share in Walgreens cash, with the transaction including “the right to conditional value that will increase value if certain targets are later achieved.”
The journal also reported that if the transaction passes, Sycamore will maintain its core US retail business and sell or publish other parts of the company.
Walgreens and Sycamore Partners did not immediately respond to requests for comment.
Walgreens shares rose this year after previous reports that private equity companies are in talks to make the drugstore chain private. The company has been struggling, announcing plans in October to close around 1,200 “low-performing” stores over the next three years, temporarily suspending its quarterly dividends to save cash earlier this year.
Walgreens shares won 10% this year, but lost half of its value in the 12 months until Monday.
