The British health and beauty chain has been put up for sale by Walgreens Boots Alliance after the US parent indicated that it wanted to focus on the American market. Boots which employs 51,000 people has 2,200 shops and 550 opticians, the majority of which require some refurbishment.
The sale process has been complicated by market volatility caused by Russia’s invasion of Ukraine, which has made buyers nervous about raising expensive debt.
India’s Reliance Industries and Apollo, the private equity firm, have become the front-runners to buy Boots after the Issa brothers indicated that they were not prepared to pay the asking price. Reliance and Apollo are bidding together. The Issa brothers and TDR Capital, who together own EG Group and Asda, had been considering buying Boots as part of a strategy to improve Asda’s pharmacy service. They have added numerous partnerships to Asda, such as with fashion brand In The Style, in response to intense competition in Britain’s supermarket sector. It is understood that Walgreens is looking for between £6 billion and £7 billion but that the Issas tabled an offer of about £5 billion. It is not clear how much the gap between the prices is linked to the size of the stake that Walgreens has offered to keep in the business. Lord Rose of Monewden, chairman of Asda and EG Group, said that the process for Boots was “a bit like with a house — sometimes you want to have a look inside but it doesn’t mean you are going to buy it”.
