Private equity firm KKR has reportedly made a formal approach to buy Boots’ parent company and take the business private in what could be the largest leveraged buyout on record.
KKR has reportedly been preparing a proposal to potentially buy out shareholders of Walgreens Boots Alliance, according to Bloomberg.
The approach comes after Walgreens Boots Alliance boss Stefano Pessina reportedly reviewed a potential buyout with a financial adviser after receiving interest from potential buyers. Walgreens Boots Alliance has a market cap of $55bn, and the scale of the potential deal is said to have put off some buyout firms.
The size of a potential buyout would likely mean KKR and Walgreens Boots Alliance would need involvement from additional private equity firms if they were to pursue taking the business private.
Although KKR has reportedly approached the health and wellness titan, there is no guarantee that the private equity firm will put forward a formal takeover offer.
Speculation about Pessina’s ambition to take Walgreens Boots Alliance private comes after a torrid period of trading for the retail group, with operating income down 20.5% to $5bn (£3.9bn) in the year to August 31, exacerbated by weak sales at Boots in the UK.
The health and beauty group has upped its cost-saving target from over $1.5bn to over $1.8bn by its 2022 financial year as a result.
KKR sold its final shares in Walgreens from a previous buyout three years ago.
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