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It
is a rough era for national pharmacy chains like Walgreens, CVS,
and Rite-Aid, closing hundreds of stores due to changing
consumer behavior, declining pharmacy reimbursements and rising
costs. Walgreens will close more than 1,000 stores through 2027
and Rite-Aid filed for bankruptcy protection in May, it's second
trip to bankruptcy court in as many years.
Walgreens shareholders will receive $11.45 per share from
Sycamore Partners per the terms of the deal first announced in
March, the companies said Friday. They could also receive as
much as an additional $3 per share from the future monetization
of Walgreens' debt and equity interests in its VillageMD clinic
business.
The buyout, which will take the drugstore chain private, will
give it more flexibility to make changes to improve its business
without worrying about Wall Street’s reaction. Walgreens was
founded in 1901 and has been a public company since 1927.
“With Sycamore’s partnership, we will be better positioned to
accelerate our turnaround strategy,” said Walgreens CEO Tim
Wentworth.
Walgreens shares were largely unchanged by Friday’s news,
hovering around $11.50, as they have since the deal was
announced. Just two years ago, they were worth more than $30
each.
Last fall, the company announced a plan to close 1,200 of its
roughly 8,500 U.S. locations.
The company, based just north of Chicago in Deerfield, Illinois,
had already shed about a thousand U.S. stores since it grew to
nearly 9,500 after buying some Rite Aid locations in 2018.
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