AmerisourceBergen to purchase Walgreens’ distribution unit in $6.5 billion Europe push

© Reuters. The logo of Walgreens is seen at their Times Square store in New York

(Reuters) – U.S. drug wholesaler AmerisourceBergen (NYSE:) Corp said on Wednesday it would buy Walgreens Boots Alliance (NASDAQ:)’s drug distribution business for $6.5 billion to expand in Europe.

The deal will help Walgreens focus more on core pharmacy unit as well as its retail business, where sales have tanked due to the COVID-19 pandemic, resulting in a nearly 30% slump in shares in 2020.

AmerisourceBergen will pay the debt-laden pharmacy chain $6.27 billion in cash and deliver 2 million of its common stock at closing of the transaction. With a 30% stake, Walgreens is the largest shareholder of AmerisourceBergen.

Walgreens’ unit, Alliance Healthcare, is one of the largest drug distributors in Europe. The deal will not include operations in China, Italy and Germany and Alliance Healthcare UK will remain a partner of Walgreens’ country unit until 2031.

Reuters reported in May last year that AmerisourceBergen had approached Walgreens to explore a deal for the company’s drug distribution business.

Walgreens had in 2019 explored going private and held preliminary discussions with private equity firms, people familiar with the matter said at the time.

The company has an agreement to source branded and generic drugs from AmerisourceBergen in the United States. The companies said their U.S. distribution agreement will be extended by three years until 2029.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Comments are closed.