Walgreens completes $6.5 billion wholesale pharmacy sale to AmerisourceBergen
The sale allows Walgreens to focus on its retail pharmacy and healthcare business, including strategic moves into primary care.
Photo: Walgreens/Courtesy Walgreens
Walgreens Boots Alliance has announced it has completed the sale of its Alliance Healthcare wholesale pharmacy business to AmerisourceBergen for $6.5 billion.
The sale includes $6.275 billion in cash and 2 million shares of AmerisourceBergen common stock.
The company said it will use the cash to reduce debt and accelerate growth of its core retail pharmacy and healthcare businesses.
Walgreens has used a portion of the funds to repay the outstanding amount owed on a $3.8 billion term loan. This has eliminated $3.3 billion in debt from the company's balance sheet.
WHY THIS MATTERS
The sale allows Walgreens to focus on its retail pharmacy and healthcare business, including strategic moves into primary care.
Cash remaining after the elimination of debt will be invested in the expansion of healthcare offerings to help accelerate the company's growth strategy, Walgreens said.
These investments will further build on previously announced initiatives, including its investment in VillageMD to support the opening of 600 to 700 Village Medical at Walgreens primary care clinics, as well as the acquisition of a majority stake in iA, a leading-edge provider of software-enabled pharmacy automation solutions.
WBA and AmerisourceBergen will also execute on the expansion and extension of commercial agreements that are expected to drive incremental growth and synergies, Walgreens said.
THE LARGER TREND
The companies announced the sale in January.
The sale allows Walgreens to move ahead on its expansion of retail pharmacy and healthcare. The deal with VillageMD is to open 500 to 700 clinics in Walgreens locations over the next five years.
Walgreens said late last year that it planned to open 40 new full-service primary care units by the end of this summer.
As one of the largest pharmaceutical wholesalers in Europe, Alliance Healthcare will grow AmerisourceBergen's wholesale, distribution and related business, ultimately expanding the breadth and depth of its global manufacturer services, AmerisourceBergen President and CEO Steven Collis said in the announcement.
ON THE RECORD
"Completion of this transaction represents a significant step forward in our transformation and will fuel investments to grow WBA's core retail pharmacy and healthcare businesses," said Rosalind Brewer, CEO of Walgreens Boots Alliance. "Through these and other investments, WBA looks to bring even more innovative healthcare offerings to our customers and patients, as we further accelerate our strategic priorities."
Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com
