Walgreens to Go Private in Landmark $24 Billion Deal

Walgreens Boots Alliance is set to become a privately held company in a deal worth up to $23.7 billion, marking the end of nearly a century as a publicly traded entity. The decision comes after a tumultuous period on the stock market, during which Walgreens’ market value plummeted by billions and the company was forced to close more than 10% of its locations.

The private equity firm Sycamore Partners has agreed to acquire Walgreens for $11.45 per share in cash, with the full value of the deal – including debt and potential payouts – potentially reaching $23.7 billion.

Declining Market Value and Strategic Shift

Walgreens’ stock has lost nearly 80% of its value over the past five years, though recent months saw a slight rebound amid reports of a potential buyout. The company has struggled to keep pace with rivals like CVS, facing declining prescription reimbursement rates, increased competition, and operational challenges.

Sycamore, which specializes in consumer and retail investments, intends to keep Walgreens’ operations based in the Chicago area.

“While we are making progress on our turnaround strategy, creating long-term value requires time, focus, and structural changes best handled as a private company,” said Walgreens CEO Tim Wentworth. He added that Sycamore’s expertise in retail turnarounds would be crucial to the company’s future.

Store Closures and Industry Challenges

Walgreens has been aggressively downsizing, announcing in October 2024 that it would close 1,200 locations by 2027 – around one in seven stores. This followed an earlier round of 300 store closures as part of a multi-year optimization plan. At the time, the company admitted that about a quarter of its locations were unprofitable.

Unlike CVS, which acquired health insurer Aetna in 2018 to strengthen its healthcare footprint, Walgreens focused on acquisitions like VillageMD clinics, which required heavy investments in real estate, technology, and labor. Analysts suggest this strategy may have stretched the company thin, making a private takeover an “elegant solution” to unlock investor value.

Future Prospects and Closing Timeline

Industry experts believe Walgreens’ healthcare assets will attract strong interest as the sector shifts toward value-based care. Meanwhile, Sycamore may consider selling Boots, its UK pharmacy chain, to maximize returns.

Despite these challenges, Walgreens remains a major player in the retail pharmacy space, but its transition to private ownership signals a significant shift in strategy. The deal is expected to close in the fourth quarter of 2025.