Walgreens Boots to Sell Unit to AmerisourceBergen

Walgreens Boots Alliance has agreed to offer most of its pharmacy distribution device to drug wholesaler AmerisourceBergen for $six.5 billion to focus on its main retail organization and expanding its wellness-care offerings.

The Alliance Health care device distributes wellness-care goods and expert services to extra than one hundred fifteen,000 pharmacies, hospitals, and other wellness providers, functioning in 13 countries, primarily in Europe.

The offer introduced on Wednesday calls for AmerisourceBergen to shell out about $six.three billion in hard cash and two million of its shares for Alliance Health care. Underneath an current arrangement, Walgreens sources branded and generic medicine from AmerisourceBergen in the U.S.

The transaction “is a sensible move subsequent the success of our extended-phrase strategic relationship with AmerisourceBergen which has been a powerful and reliable partner because 2013,” Walgreens CEO Stefano Pessina claimed in a information launch. “The transaction will fuel increased long term investments to develop and renovate our main retail pharmacy and healthcare companies.”

In its most up-to-date quarter, Walgreens produced $six billion in gross sales from Alliance Health care and the thirty% stake it owns in AmerisourceBergen. U.S. gross sales for Walgreens’s U.S. retail-pharmacy device had been up around 4% to $27 billion.

As The Wall Avenue Journal stories, Walgreens’s go to exit most of its wholesale organization will come as faces problems linked to the coronavirus pandemic. It has also been “seeking to give people extra reasons to check out [its retail] areas as Amazon pushes into the prescription-drug organization.”

The business has partnered with VillageMD to open up clinics with major-care medical professionals at Walgreens sites across the U.S. over the next five many years.

For AmerisourceBergen, “The offer is intended to broaden AmerisourceBergen’s presence in Europe, as Alliance is a single of the most significant wholesalers on the continent,” the Monetary Periods claimed.

“Today’s announcements will broaden our access and methods in pharmaceutical distribution and incorporate to AmerisourceBergen’s breadth and depth of world-wide maker expert services,” the company’s CEO, Steven Collis, claimed.

In buying and selling Wednesday, Walgreens shares rose 4.5% to $forty three.03. The sale of Alliance Health care is expected to incorporate to its modified earnings for every share in the higher-teens proportion right after it closes by the end of fiscal 2021.

AmerisourceBergen, drug distribution, Well being Care, retail pharmacy, Stefano Pessina, Walgreens Boots Alliance