Walgreens and Alliance Boots seal the deal on two-year merger

Alliance Boots and US pharmacy giant Walgreens have finally completed their two-step merger launched in 2012 to create Walgreens Boots Alliance.

The deal will combine the largest drugstore chain in the States, the retail pharmacy market leader in Europe, and the wholesale and distribution business Alliance Healthcare to create “the world’s first global pharmacy-led, health and wellbeing enterprise”.

The new enlarged company will operate in over 25 countries with 12,800 stores and 370,000 employees. It will also have more than 340 pharmaceutical distribution centres serving over 180,000 pharmacies and other points of care.

Greg Wasson, who is stepping down as Walgreens’ president and chief executive after the merger, said the creation of Walgreens Boots Alliance is a “crucial milestone” for both parties.

The deal “combin[es] iconic brands, complementary geographic footprints, shared values and a heritage of trusted health care services through pharmaceutical wholesaling and community pharmacy care, each dating back more than 100 years”.

The first step of the merger saw Walgreens invest $4bn in cash and 83.4m shares for a 45% stake in Alliance Boots. Step two involved the acquisition of the remaining 55% stake in exchange for $5.3bn and 144.3m shares.

After Walgreens’ shareholders approved the tie-up earlier in the week, the US company's shares will be converted automatically into shares of Walgreens Boots Alliance common stock, which will trade on the Nasdaq in New York.

The company will be domiciled in the US and headquartered in Deerfield, Illinois.

Stefano Pessina, who will become boss of the new company after Wasson’s retirement, said: “The combined strength, scale and expertise of Walgreens Boots Alliance creates a unique and unparalleled global leader.”