The Walgreens logo will appear on October 15th, 2024 in the Walgreens store in San Rafael, California.
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A struggling drugstore chain Walgreen It will be private.
The company said Thursday it had signed a deal with private equity company Sycamore Partners.
Sycamore pays $11.45 per share in Walgreens cash, representing a premium of about 8% of the stock’s closing price on Thursday. Shareholders will also be able to receive up to $3 or more per share in the future from sales of Walgreens’ primary care businesses, including Village Medical, Summit Health and CityMD.
Walgreens said that if you include debt and potential payments on the line, the total transaction amounts to up to $23.7 billion.
Walgreens and Sycamore are hoping to close Take-Private’s deal in the fourth quarter of this year. Walgreens shares have since halted after Thursday, jumping more than 5% in after-hours trading.
The historic deal concluded Walgreens’ turbulence, which began in 1927 as a public company. As of Thursday morning, the company’s shares had risen by more than 15% in 2025, but still fell by more than 48% last year, and fell by 70% over the past three years.
“While we advance towards ambitious turnaround strategies, creating meaningful value requires time, focus and change to be better managed as a private company,” Tim Wentworth, CEO of Walgreens, who took on the role in 2023, said in a release Thursday. “Sycamore offers the expertise and experience of our partners with a strong track record of successful retail turnarounds.
Stefan Kaluzny, managing director of Sycamore, said in the release that the deal reflects Walgreens’ confidence in a pharmacy-driven model and its important role in driving better outcomes for patients, customers and communities.
Walgreens will remain headquartered in Chicago. The company currently has over 310,000 employees worldwide and 12,500 retail pharmacies locations in the US, Europe and Latin America. Walgreens is expected to release second quarter revenue on April 8th.
Walgreens’ market value peaked at over $100 billion in 2015 as investors gained confidence in their healthcare business and expansion plans and became one of the most prominent American retailers.
However, in the second half of 2024, major rival CVs, grocery chains, major retailers, and Amazonalong with many challenges. Walgreens has been narrowed down by a shift away from Covid Pandemic, Pharmacy redemption headwinds, softer consumer spending, and a problematic push to healthcare.
Both Walgreens and CV have pivoted from long-standing store expansions until they close hundreds of US retail pharmacies to make money. However, unlike CVS, which diversifies its business model by providing insurance and pharmacy benefits, Walgreens has significantly doubled its current retail pharmacy business.
In October, Walgreens said it plans to close around 1,200 drug stores over the next three years, including 500 in fiscal year 2025 alone. Walgreens has around 8,700 locations in the US, with a quarter of which is said to be unprofitable. The company also reduced its push to primary care by cutting stakes in provider Villagemd.
Walgreens helped healthcare veteran Tim Wentworth tapped as new CEO in late 2023 to regain his footing.
The company has reportedly been considered a potential private equity target in the past.
In 2019, private equity firm KKR made an offer of about $70 billion in acquisitions to Walgreens, reported by the then Financial Times and Bloomberg.
