Instability in the global financial markets has caused Walgreens Boots Alliance to take its Boots business off the selling block.
The company said it has decided to keep its U.K.-based health and beauty retailer Boots and No7 Beauty Company businesses under its existing ownership. The decision follows the completion of a strategic review of the businesses that began in January and was in line with Walgreens’ increased emphasis of its U.S. health care offerings.
Walgreens said it had held discussions about the U.K. businesses with a range of parties, receiving “significant” interest from prospective buyers. But the company noted that since January, the global financial markets have suffered “unexpected and dramatic change.”
“As a result of market instability severely impacting financing availability, no third party has been able to make an offer that adequately reflects the high potential value of Boots and No7 Beauty Company,” the company stated. “Consequently, WBA has decided that it is in the best interests of shareholders to keep focusing on the further growth and profitability of the two businesses.”
The decision to keep the businesses has also been supported by their ongoing strong performance, which have exceeded expectations despite challenging conditions, Walgreens said. The 173-year-old Boots business includes 2,200 stores in the U.K., including pharmacies, health and beauty stores.
“It is an exciting time for these businesses, which are uniquely positioned to continue to capture future opportunities presented by the growing healthcare and beauty markets,” said Walgreens CEO Rosalind Brewer. “The board and I remain confident that Boots and No7 Beauty Company hold strong fundamental value, and longer term, we will stay open to all opportunities to maximize shareholder value for these businesses and across our company.”
Under the leadership of Brewer, Walgreens has been focusing on expanding its health care operations. In October 2021, the company said it was investing $5.2 billion in VillageMD, increasing its ownership stake in the company from 30% to 63%. Walgreens said the investment will accelerate the opening at least 600 Village Medical primary care clinics at Walgreens locations in more than 30 U.S. markets by 2025, with a goal of 1,000 by 2027. To date, the company has opened 81 Village Medical locations.
The company is also allocating space in select locations for a Health Corner that is staffed by nurses and pharmacists who can consult with patients on chronic conditions or other medical needs. It has opened 47 such spaces to date, with plans to have more than 100 in place by the end of 2022.