Dive Transient:
- Walgreens shareholders overwhelmingly accredited the beforehand introduced $10 billion acquisition of the corporate by non-public fairness agency Sycamore Companions, in response to a Friday information launch.
- Preliminary outcomes present that about 96% of votes forged by shareholders have been in favor of the merger settlement between the publicly held Walgreens and Sycamore. The early outcomes additionally revealed about 95% of unaffiliated shareholders voted for the merger.
- The deal is predicted to shut through the third or fourth quarter of 2025. Shareholders will obtain $11.45 per share in money and will earn one other $3 per share from the long run sale of VillageMD companies, which embrace Village Medical, Summit Well being and CityMD. The full worth of the transaction represents virtually $24 billion, together with debt and future payouts, per the corporate.
Dive Perception:
The acquisition of the corporate and its path to privatization comes as Walgreens’ gross sales proceed to spiral downward. The retailer’s Q3 front-of-store retail gross sales declined 5.3% 12 months over 12 months, whereas it swung into the crimson, reporting a internet lack of $175 million.
Walgreens introduced in October it could shut 1,200 of its shops over the following three years as a part of a turnaround technique.
The retailer had invested closely in healthcare companies lately, together with pouring billions of {dollars} into main care chain VillageMD. Nonetheless, the enterprise struggled financially, and Walgreens started closing underperforming clinics. Final 12 months, Walgreens mentioned it was contemplating a full sale of VillageMD.
The retailer’s U.S. Healthcare section reported $2.1 billion in gross sales in its third quarter ended Could 31, a lower of $23 million from the earlier 12 months pushed by a decline in VillageMD gross sales. The unit reported an working lack of $64 million.
Upon the deal closing, Walgreens will grow to be a privately held firm for the primary time in practically 100 years.
“We recognize the consideration and overwhelming assist from our shareholders in our value-maximizing transaction with Sycamore,” Tim Wentworth, CEO of Walgreens, mentioned in an announcement. “With Sycamore’s partnership, we will probably be higher positioned to speed up our turnaround technique, additional improve the client, affected person and staff member expertise and grow to be the primary selection for pharmacy, retail and well being companies. We look ahead to closing the transaction and coming into this subsequent chapter.”
Walgreens isn’t the one main drugstore chain to expertise struggles lately. Ceremony Support filed for 2 bankruptcies previously two years, with its most up-to-date Chapter 11 submitting occurring in Could, simply eight months after rising from its first.
Healthcare Dive reporter Emily Olsen contributed reporting.
