The future of Boots has been plunged into uncertainty as the buyout fund negotiates with its US owner.
Pharmaceutical giant Walgreens Boots Alliance, which bought Boots in 2014, is said to be in takeover talks with private equity firm Sycamore Partners.
News of the talks leaked Tuesday night, sending Walgreens shares soaring.
Walgreens Boots Alliance’s market value has collapsed in recent years, falling from a peak of $100bn (£78bn) in 2015 to $7.5bn (£5.8bn) earlier this week.
Sources said there would be no immediate impact on Boots’ business.
But any buyer is likely to try to spin off Boots as a separate UK company.
Chief executive Stefano Pessina, who masterminded the creation of Walgreens Boots Alliance after a lucrative deal-making career, still owns a 17 per cent stake, worth around £1bn, and will be at the helm of any deal.
Bosses have previously tried unsuccessfully to boost the US company’s valuation with spin-off plans for Boots.
In the last two years, two sales processes have been initiated and terminated.
In 2022, a £5 billion auction for the British high street chain included the interests of Asda’s owners, the Issa brothers.
But talks stalled after bidders rejected Walgreens’ asking price for the investment-heavy deal.
A few years ago Boots seemed to be the problem child of the American group.
But the situation has changed and the British chain is now the strongest part of the business, generating significant cash.
Walgreens is trying to overhaul its retail business and has announced it will close 1,200 US stores after a loss of $3bn (£2.3bn).
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Pharmaceutical giant Walgreens Boots Alliance, which bought Boots in 2014, is reportedly in takeover talks Credit: Getty
The future in his hands
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Executive Chairman Stefano Pessina at the unveiling of Florence Boot’s portrait at the National Portrait Gallery
CEO Stefano Pessina told The Sun last month: “Boots is an important business. It will be for many years to come.”
His affection for the 175-year-old chain was clear.
The 83-year-old flew to London for the National Portrait Gallery to unveil a portrait of Florence Boot, wife of the company’s founder.
Mr Pessina cemented his legendary deal merchant status and wealth through Boots — first with a merger with Alliance, then a KKR private equity deal and finally a tie-up with Walgreens, which now looks like a mistake.
Another deal could unravel the previous one and wind the clock back a decade.
Captain, merchant, legend
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Chelsea legend John Terry took part in the ICAP charity dayCredit: PHOTO: ICAP
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He joined TV presenter Rachel Riley at an event where traders donate commissions to good causesCredit: PA
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Actors Ray Winstone and Joely Richardson were also at London’s HQCredit: PA
CHELSEA legend John Terry took part in ICAP’s charity day where traders donate commissions to good causes.
He joined TV’s Rachel Riley and actors Ray Winstone and Joely Richardson at the London headquarters.
It comes a day after ICAP founder Lord Michael Spencer said British bosses should be paid like “top footballers”.
Optional ongoing fees
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Fixed benefits have been criticized during the cost of living crisis Credit: Getty
ENERGY companies will be forced to offer customers the option of tariffs without fixed charges, under plans by regulator Ofgem.
Fixed charges have been criticized during the cost of living crisis because they are unavoidable even when the heating is off.
Savings guru Martin Lewis said: “Ongoing charges are a tax on energy bills of £338 a year.”
He added that people refused to reduce their consumption, and elderly customers who only heated themselves in winter were punished by paying every day in summer.
Suppliers like UTILITA offer little or no ongoing fees, but usually charge more per unit of energy used.
Energy experts Cornwall Insight say ongoing charges currently account for a fifth of household energy bills.
Ofgem is also examining how to tackle the industry’s £3.8bn of bad debts from consumers struggling to pay their bills and the potential for support levels.
Close car call
BANK shares soared yesterday as the Supreme Court gave lender Close Brothers permission to appeal a landmark ruling over the growing motor finance scandal.
Close Brothers own shares rose more than 12 percent, while Lloyds rose 4.4 percent.
Close Brothers will challenge an earlier ruling in the commission scandal, which has left the entire car finance industry on the hook for compensation claims from millions more drivers than previously anticipated.
Christmas high flyer
HEATHROW is gearing up for its busiest Christmas ever amid a flurry of tourists.
The airport expects 21 percent more passengers to travel through its terminals on December 25. The numbers for December as a whole should also surpass last year’s record of 6.7 million.
It comes after tourism company TUI announced yesterday that annual pre-tax profits jumped by a third.
The German group, which recently delisted in London to focus on Frankfurt, revealed a 12 percent rise in revenue.
ELON Musk has become the first person to amass a $400bn (£313bn) fortune.
The tycoon, who owns Tesla, SpaceX and X, has seen its value jump by two-thirds since Donald Trump’s election victory, according to the Bloomberg Billionaires Index.
Rent jump
AVERAGE house rental costs are up £270 a month since the pandemic, research shows.
Landlords now face an average annual bill of £15,240, Zoopla said – an increase of more than a quarter since Covid ended.
The sharp increase began in 2021, as people wanted to move after the pandemic, while the supply of homes was limited.
Meanwhile, the average asking price for a house will rise by 4 per cent by the end of 2025, Rightmove forecast.
It also predicts that the average mortgage rate will drop to 4 percent by then.
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