Walgreens in talks for private equity buyout, sources say
Walgreens is currently in talks to take the company private, with sources familiar with the matter telling the Wall Street Journal it could be sold to a private equity firm.
According to report, Walgreens and Sycamore partners have taken an interest in the struggling pharmacy chain. A deal could be completed in early 2025, assuming the parties come to an agreement.
Walgreens has been rattled by poor sales. In June, the company said 25% of its stores were struggling and that it planned to close many of them down as it worked to restructure its business.
At that time, the company said it still believed it would turn a profit in 2024. Judging by its latest financial statements, it appears that’s still the case. However, sales have been sliding for several years.
The company has also been embroiled in legal battles, settling an opioid prescription complaint with the city government of Baltimore for $80 million in September. That same month, it paid out $107 million to resolve accusations of Medicare and Medicaid fraud brought by the U.S. Department of Justice.
It settled another fraud lawsuit in November related to its prescription membership program, paying a class-action of plaintiffs $100 million.
Walgreens stock has slid downward over 52% since December last year. It did not see any upward turn on news that it may be selling to private equity—however, sources said investors are thrilled by the news.
The potential sale to Sycamore Partners seems like a good match. The New York-based firm has a history of investing in the consumer retail space, with a portfolio that includes Staples, Belk and Hot Topic.
Walgreens currently operates around 8,700 stores in the U.S. and 12,000 globally.
Chad is an award-winning writer and editor with over 15 years of experience working in media. He has a decade-long professional background in healthcare, working as a writer and in public relations.