The largest drugstore chain in the U.S., Walgreen, has completed its acquisition of the UK-based Alliance Boots on Dec 31, 2014, to form a new company called Walgreens Boots Alliance Inc. Walgreens Boots Alliance, the first global pharmacy-led health and wellbeing enterprise, will start trading on the Nasdaq under the ticker symbol “WBA”.
The merger process, which began in Jun 2012, was completed this week following the approval by Walgreen’s shareholders on Dec 29, 2014. Existing shares of Walgreen common stock were automatically converted into shares of Walgreens Boots Alliance common stock on a one-for-one basis.
Walgreen is now a fully-owned subsidiary of the new company, which will be headquartered in Deerfield, IL. Stefano Pessina will become the acting CEO of Walgreens Boots Alliance, following the retirement of Walgreen’s current CEO Greg Wasson.
Walgreen and Alliance Boots had launched a long-term strategic partnership in Jun 2012, when the former acquired 45% equity ownership in the latter for about $6.7 billion in cash and stock. The deal included an option to pursue a full combination by acquiring the remaining 55% of Alliance Boots. Walgreen exercised this option in Aug 2014 by agreeing to pay another $15.3 billion in cash and stock to complete the deal.
The acquisition will greatly expand Walgreen's international presence. The new global enterprise combines Walgreen, the largest drugstore chain in the U.S.; Boots, the market leader in European retail pharmacy; and Alliance Healthcare, the leading international wholesaler and distributor. The combined entity spans over 25 countries with more than 12,800 stores, and over 370,000 employees.
The merger will also bring together a unique portfolio of retail, wholesale, service and product brands, alongside the world’s largest pharmaceutical wholesale and distribution network. With attainment of the global stature, Walgreen will be able to generate significant and sustainable benefits for local markets as well as all stakeholders.
Currently, Walgreens Boots Alliance carries a Zacks Rank #3 (Hold).
Better-ranked stocks include CVS Health Corp. (CVS) and Rite Aid Corp. (RAD) in the retail drug industry and Abiomed (ABMD) in the medical instruments industry. All three stocks carry a Zacks Rank #2 (Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment