In a bid for survival, Walgreens Boots Alliance has agreed to go private. The struggling pharmacy giant has struck a deal with private equity firm Sycamore Partners, which will shell out nearly $10 billion for the company. The announcement comes at a time when retailers around the country are struggling, and U.S. retail closures are expected to exceed openings again this year.
This acquisition gives Walgreens the flexibility to make changes without having to appease shareholders. The company has been battling razor-thin prescription reimbursements, soaring costs, theft and budget-conscious shoppers heading elsewhere for deals. Walgreens has undertaken a massive restructuring, including closing 1,200 of its 8,500 U.S. stores. That’s on top of the 1,000 locations it has already closed since 2018.
Then there’s Walgreens’ ambitious health care expansion—now under review. The company had gone all-in on VillageMD clinics, but last August, it hinted at selling all or part of the business, just two years after pouring billions into it.
Competitors like CVS, Walmart and Kroger are still in the game, proving that the pharmacy business isn’t completely dead—just evolving. Walgreens’ deal with Sycamore is a high-stakes play that the company hopes will lead to a serious comeback.