Seller: Walgreens WBA
Expanded commercial agreements to drive incremental growth and synergies.
DEERFIELD, Ill. — Walgreens Boots Alliance (WBA) announced that it has finalized the sale of its Alliance Healthcare businesses to AmerisourceBergen for total consideration of approximately $6.5 billion, made up of $6.275 billion in cash (subject to a customary net cash and working capital adjustment) and 2 million shares of AmerisourceBergen common stock. The company will use the cash proceeds to reduce debt and accelerate growth of its core retail pharmacy and health care businesses.
The company has used a portion of the funds to repay the outstanding amount owed on a $3.8 billion term loan that funded the bond tender completed by the company on April 26, 2021. This has eliminated $3.3 billion in debt from the company’s balance sheet. The remaining net cash proceeds are planned to be invested in strategic opportunities and to expand healthcare offerings to help accelerate the company’s growth strategy.
These investments will further build on previously announced initiatives, including WBA’s investment in VillageMD to support the opening of 600-700 Village Medical at Walgreens primary care clinics, as well as WBA’s acquisition of a majority stake in iA, a leading-edge provider of software-enabled pharmacy automation solutions.
“Completion of this transaction represents a significant step forward in our transformation and will fuel investments to grow WBA’s core retail pharmacy and health care businesses,” said Rosalind Brewer, CEO, Walgreens Boots Alliance. “Through these and other investments, WBA looks to bring even more innovative healthcare offerings to our customers and patients, as we further accelerate our strategic priorities.”
WBA and AmerisourceBergen will also execute on the expansion and extension of commercial agreements that are expected to drive incremental growth and synergies.
The M&A market for healthcare companies continues to strengthen in 2021 and ahead of the projected increases in US capital gains taxes. There is unprecedented capital in market, the lowest interest rates in US history and strong acquirer motivations for high quality healthcare companies. Across the continuum of care, buyers and investors are looking for well established, profitable businesses and offering strong valuations and options for management.
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