Pharmacy and beauty retailer Boots is in discussions with an Australian competitor and the billionaire Weston family regarding a potential £7.5 billion sale. Australian pharmacy group Sigma Healthcare confirmed on Wednesday that it has held "preliminary discussions" over a takeover. The firm told shareholders that there is "no certainty" any transaction will take place.
This followed a report by the Financial Times suggesting the UK-based pharmacy and beauty chain could favour a 10 billion US dollar (£7.5 billion) sale over a potential stock market flotation. The report also revealed that Boots had held talks with the Canadian branch of the billionaire Weston family, which holds a controlling stake in grocery chain Loblaws. The British arm of the Weston family is the majority owner of Primark through its parent company Associated British Foods, which also owns grocery brands including Twinings and Ryvita.
Early Stage Negotiations
It is understood that negotiations with both prospective buyers remain at an early stage. The potential sale comes just a year after Boots was acquired by private equity firm Sycamore Partners, following the US investment giant's purchase of parent company Walgreens Boots Alliance for 23.7 billion US dollars (£17.7 billion).
In August last year, Sycamore separated Boots from its US operations. The newly formed UK-based Boots business encompassed Boots UK and Ireland, Boots Opticians, No7 Beauty Company and pharmacies in Thailand, Mexico and Germany. It is understood that Sycamore is still weighing up a potential initial public offering (IPO) for Boots on the London stock market.
Impact on London Stock Exchange
A private sale would deliver yet another setback to the London Stock Exchange, which has been grappling with a shortage of significant new listings in recent years. Nottingham has been home to Boots since 1849, and any change in ownership could have implications for the city and its workforce.
