Sycamore Partners to Acquire Walgreens in $10 Billion Private Equity Deal

In a significant move that could reshape the retail pharmacy landscape, private equity firm Sycamore Partners has announced a definitive agreement to acquire Walgreens Boots Alliance (WBA) in a deal valued at $10 billion. The transaction, which is expected to close in the fourth quarter of 2025, will take the struggling pharmacy chain private, allowing for a focused turnaround strategy away from public market pressures.

Deal Structure and Valuation

Sycamore Partners has agreed to pay $11.45 per share for Walgreens, representing an equity value of approximately $10 billion. However, when accounting for debt and future payouts, the total value of the deal could reach up to $23.7 billion, according to a press release from Walgreens. The agreement includes a 35-day "go-shop" period, during which Walgreens can seek potentially better offers, though the company has not guaranteed that a superior deal will materialize.

Strategic Implications and Future Plans

The acquisition comes at a crucial time for Walgreens, which has been grappling with industry-wide challenges and specific issues within its VillageMD unit. Following the completion of the deal, Walgreens will continue to operate under its current brand names, including Boots and its portfolio of consumer brands. The company will maintain its headquarters in Chicago.

Walgreens CEO Tim Wentworth emphasized the potential benefits of going private, stating, "While we are making progress against our ambitious turnaround strategy, meaningful value creation will take time, focus and change that is better managed as a private company." He added that Sycamore Partners brings "expertise and experience" with a strong track record in retail turnarounds.

VillageMD Divestiture Exploration

As part of the transaction, Walgreens has announced the formation of a committee to explore options for its VillageMD business. The company is considering all avenues to maximize the value of this primary care provider, including potential operational improvements and balance sheet strengthening, ahead of any future monetization transactions. This move signals a potential shift in Walgreens' healthcare strategy and could lead to significant changes in its business model.

Stefan Kaluzny, Managing Director of Sycamore Partners, expressed confidence in Walgreens' pharmacy-led model and its role in healthcare delivery. "For nearly 125 years, Walgreens, and for 175 years, Boots, along with their portfolio of trusted brands, have been integral to the lives of patients and customers," Kaluzny said. "This transaction reflects our confidence in WBA's pharmacy-led model and essential role in driving better outcomes for patients, customers and communities."

As the pharmaceutical and retail pharmacy sectors continue to evolve, this landmark deal sets the stage for potentially significant changes in how healthcare services are delivered and how major pharmacy chains operate in an increasingly competitive and complex market.