Pure Beauty

Walgreens scraps Boots sale plans after US company’s shares plunge

By Amanda Pauley | Published: 28-Jun-2024

The owner of the UK beauty chain has shelved its multi-billion-pound sale plan for the retailer after the company’s share price fell to its lowest level since 1997

Boots’ parent company Walgreens Boots Alliance has abandoned its alleged sale plans for the UK health and beauty retailer.

The US pharmacy company has reportedly shelved a multi-billion-pound buyout of Boots for the second time after cutting its profit outlook during the business’s latest trading update.

Walgreens Boots Alliance is now planning to close up to 700 of its own underperforming stores in the states after its share price fell to its lowest level since 1997.

Boots, however, has continued its "positive momentum" and was reported as a standout performer for the business in the last quarter.

The UK beauty retail chain’s sales soared 6% for the three months ending 31 May, with digital sales rising 13.8% thanks to app sales growing "significantly".

This news was on top of a 13% increase in its sales compared to the prior year’s quarter.

Walgreens CEO Tim Wentworth told The Telegraph he will retain ownership of Boots as he attempts to overhaul the beauty business.

The executive’s overhaul plan so far has included store closures, the removal of multiple mid-level executives and a US$1bn cost-cutting plan.

“Our review of Boots UK showed that we have attractive options to unlock value in this business,” Wentworth told the publication. 

“While we believe there is significant interest in Boots at the right time, its growth, strategic strength and cash flow remain key contributors to the company. 

“We are committed to continuing to invest in Boots UK and find innovative ways for this business to fulfil its potential.”

Walgreens has already shut 650 Boots stores in the UK and faced criticism about underinvestment in the business.

This news follows months of speculation that Walgreens was looking to sell Boots.

There were rumours the company had allegedly postponed an IPO listing for the UK chain due to ongoing talks with potential buyers.

Boots also sold its pension scheme to investment firm Legal & General last year in a move thought to make it easier to sell.

Walgreen Boots Alliance first attempted to sell Boots in 2022 but abandoned the idea after it failed to find a suitable buyer.

The company cited “unexpected and dramatic” changes in market conditions as key reasons.

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