Walgreens has entered into a deal with private equity firm Sycamore Partners to go private in a transaction valued at around $10 billion.
The big picture: Sycamore Partners will pay $11.45 per share in cash for Walgreens, with an 8% premium to the stock’s closing price on Thursday.
- Additionally, shareholders could receive up to $3 more per share in the future from sales of Walgreens’ primary-care businesses, raising the total value of the transaction to up to $23.7 billion when considering debt and potential future payouts.
- The take-private deal between Walgreens and Sycamore is expected to close in the fourth quarter of the year. Following the announcement, Walgreens’ stock price surged over 5% in after-hours trading before being halted.
Driving the news: This deal marks the end of Walgreens’ journey as a public company since its inception in 1927.
- Despite a 15% increase in its stock price in 2025, the company has faced significant declines, with the stock down over 48% for the last year and 70% for the past three years.
- Walgreens’ challenges stem from market competition, including rivalry with CVS, grocery stores, large retailers like Amazon, and various operational difficulties. The company has announced plans to close approximately 1,200 underperforming drugstores over the next three years and has restructured its approach to primary care by reducing its stake in VillageMD.
What we’re watching: Walgreens will continue operating from its headquarters in Chicago and will retain its global workforce of over 310,000 employees, serving customers through 12,500 retail pharmacy locations across the U.S., Europe, and Latin America.
- The company plans to release its second-quarter earnings on April 8.
What they’re saying: “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,” said Walgreens CEO Tim Wentworth. “Sycamore will provide us with the expertise and experience of a partner with a strong track record of successful retail turnarounds.
