Walgreens set to buy remaining stake in Alliance Boots - UPDATE
US giant Walgreens is set to buy the remaining stake in Alliance Boots, Britain's biggest pharmacy chain for £5bn but keep its headquarters in the States.
The American drugs chain bought a 45% stake in Alliance Boots in 2012 for £4bn, with the option of buying the remainder 55% within three years.
The final decision of the acquisition was confirmed by Boots on Wednesday morning, with the combined enterprise to be named Walgreens Boots Alliance and headquartered in the Chicago area, which is likely to avoid damaging their reputation amongst US consumers over tax inversion by moving to the UK or Switzerland.
The transaction is expected to complete in the first quarter of calendar 2015, subject to shareholder and various regulatory approvals.
Boots will continue to be headquartered in Nottingham, UK and the current support offices of Alliance Healthcare will remain across Europe.
The UK company's chief executive Stefano Pessina will become executive vice chairman, responsible for strategy and mergers and acquisitions, as well as chairman of a new board strategy committee.
Pessina and Walgreens boss Greg Wasson, who will be president and CEO of the enlarged group, announced a new comprehensive plan that seeks to provide additional shareholder value creation, both in the near and long term.
Pessina said the combination represented "the most significant milestone in the history of our group and, importantly, a very positive step for the future of the healthcare industry as a whole".
"Together with Walgreens, we have already made good progress over the past two years and I strongly believe that the merger will bring significant growth opportunities for both mature and emerging markets."
Walgreens Boots Alliance will become the world's largest pharmaceutical wholesale and distribution network and the world's largest buyer of prescription drugs and many other health and wellbeing products.
Shares in Walgreen were down almost 5% in premarket trading
JF