(Bloomberg) — Sycamore Partners is in talks to amass struggling drugstore chain Walgreens Boots Alliance Inc (WBA)., in keeping with folks aware of the matter.
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The New York-based personal fairness agency has been having ongoing discussions a couple of deal to take Walgreens personal, mentioned the folks, who requested to not be recognized as a result of the main points aren’t public. It’s potential discussions may fall by means of with no deal materializing, the folks added.
The inventory jumped as a lot as 28% on the information, which was first reported by the Wall Street Journal. That was its largest single-day achieve since at the very least 1980. Walgreens shares had misplaced two-thirds of their worth over the course of the 12 months by means of Monday. That’s the worst efficiency of any inventory within the S&P 500.
The inventory was up 20% at 1:48 p.m. in New York Tuesday, giving the corporate a market worth of about $9.2 billion.
Representatives for Walgreens and Sycamore Partners declined to remark.
In October, the pharmacy chain mentioned it could be closing some 1,200 retailers over the following three years after posting a $3 billion loss within the fourth quarter on costs associated to opioid liabilities and the write-down of an funding in China. The firm’s retail division has struggled amid the rise of on-line retailers like Amazon.com and low cost giants Dollar General and Costco.
Walgreens has been a take-private candidate for years. KKR & Co. formally approached the pharmacy big a couple of deal in 2019 in partnership with present chairman and largest shareholder Stefano Pessina when the agency had a market worth of $56 billion. Sycamore Partners has a historical past of buying retailers which have seen higher instances, together with workplace provider Staples Inc. and department-store chain Belk Inc.
—With help from Gillian Tan and Cynthia Koons.
(Updates buying and selling in fourth paragraph. An earlier model of this report corrected spelling of KKR & Co. in last paragrapha)
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