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NEW YORK — According to an article in today's Wall Street Journal, Walgreens Boots Alliance is in negotiations to sell itself to a private equity firm in a transaction that would end public trading in WBA.
The article says that WBA and Sycamore Partners have been discussing a sale that could be completed early in 2025, citing unidentified sources "familiar with the matter."
WBA’s market value hit a high of over $100 billion in 2015 but has since sunk to around $7.5 billion. Its share price has plummeted nearly 70% this year.
Any deal would be a massive investment for Sycamore, a New York-based firm that specializes in retail and consumer businesses. It can be expected to divest parts of WBA or work with partners, one of the sources told the Journal.
WBA plans to shutter 1,200 stores over the next three fiscal years, including 500 in fiscal 2025, the company said in October.
CEO Tim Wentworth said in June that Walgreens’ adjusted operating income (AOI) was generated entirely by 75% of its U.S. stores. For the remaining 25%, he added, changes were "imminent.”
The company's success requires providing an efficient and relevant customer experience, he commented, saying the retailer has launched a multifaceted action plan to improve that experience. However, Wentworth cautioned, the customer has evolved and customer demographics and preferences have changed. Consequently, Walgreens needed to reposition its stores and operate them accordingly.
