Walgreens shares pop on report pharmacy chain could sell itself to PE firm Sycamore

Shares of Walgreens jumped nearly 25% on Tuesday on a report that the company is in talks to sell itself to private equity firm Sycamore Partners. 

Walgreens and Sycamore have been discussing a deal that could be completed early next year, The Wall Street Journal reported, citing people familiar with the matter.

The report comes during a rough period for the retail pharmacy giant.

Walgreens – squeezed by the transition out of the Covid pandemic, a leadership shakeup, pharmacy reimbursement pressure and its wobbly push into health-care – has underperformed Wall Street’s earnings expectations for two straight quarters.

In October, Walgreens said it plans to close roughly 1,200 of its drugstores over the next three years, which includes 500 in fiscal 2025 alone. Walgreens has around 8,700 locations in the U.S., a quarter of which it says are unprofitable.

Walgreens has reportedly been seen as a potential private equity target in the past. 

In 2019, private equity firm KKR made a roughly $70 billion buyout offer to the company, the Financial Times and Bloomberg reported at the time. 

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