Walgreens set to lose billions on Boots sale

Walgreens risks shedding billions after the one-time favourite to purchase Boots valued the retailer at a steep low cost

Boots trades from more than 2000 stores and employs over 50,000 people

// Walgreens risks shedding billions after the one-time favourite to purchase Boots valued the retailer at a steep low cost

The American owner of Boots could risk losing billions after the chemist and health and beauty retailer was valued at a steep discount.

Walgreens has been eyeing a £7bn sale of the UK company, however a consortium involving private equity firms CVC and Bain withdrew from takeover talks in March.

According to The Telegraph, the two former suitors had suggested they would only pay a price tag of £4bn for Boots.

Walgreens acquired Boots back in 2014 for £9bn, but is now hoping to sell for only £7bn after previously selling the company’s wholesale arm.

Citing City sources, the newspaper said the low valuation was significant as CVC’s UK chief Dominic Murphy is a Walgreens board member and has spent 15 years working with Boots.

He [Murphy] knows where the bodies are buried,” the newspaper quoted one City source as stating.

A spokesperson for Boots confirmed that CVC and Bain never lodged a formal offer for the company.

The billionaire brothers behind Asda, Zuber and Mohsin Issa, are also continuing to look at buying Boots, alongside private equity firms Apollo World Administration and Sycamore Capital, which recently sent two takeover proposals to Ted Baker which were rejected.

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