What to know in Michigan amid Walgreens Boots Alliance deal
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- A $10 billion deal will see Walgreens Boots Alliance go private as Sycamore Partners acquires the company.
- Michigan is home to more than 200 Walgreens locations.
Michigan’s pharmacy landscape soon will see Walgreens go private in a $10 billion deal with Sycamore Partners, but company officials say the pharmacy chain will continue to operate normally.
The move will close out nearly a century of trading on public markets for the pharmacy chain, operated by Walgreen Boots Alliance, with the acquisition announced Thursday. Walgreens has more than 200 locations in Michigan.
“Our trusted brands and deep commitment to our customers, patients, communities and team members have and will continue to anchor our business as we realize our goal of being the first choice for pharmacy, retail and health services. I am grateful to the more than 311,000 team members globally who are fiercely committed to WBA, our customers and patients,” said Tim Wentworth, CEO of Walgreens Boots Alliance.
The Company will continue to operate under Walgreens, Boots and its portfolio of consumer brands, the company said in a release. It said WBA would maintain its Chicago headquarters.
Walgreens operates more than 200 pharmacies in Michigan.
The purchase is expected to close in the fourth quarter of 2025, the company said.
The company also said the agreement also opens a 35-day window during which WBA can seek alternative offers.
Here’s what to know.
What is happening at Walgreens?
Walgreens will be purchased by Sycamore Partners, a private equity firm that specializes in retail and consumer investments, for $10 billion. Sycamore will pay $11.45 per share, a premium of 8% to the stock’s closing price of $10.60 on Thursday. Shares of the company rose nearly 6% in extended trading.
Walgreens shareholders could receive an additional $3 in cash from future monetization of the company’s debt and equity interests in VillageMD.
What led to the purchase?
Walgreens has been suffering from reduced cash flow and more than half of its $7 billion in net debt is due next year.
The company is closing thousands of stores and has embarked on a $1 billion cost-cutting program under CEO Tim Wentworth, with some success.
The chain currently employs 311,000 people in 12,000 stores in eight countries, according to its website, a sharp decline from the 25 countries, 450,000 employees and 21,000 stores it had four years ago, the release said.
How did missteps hurt Walgreens?
Many of the company’s missteps were under former CEO Stefano Pessina, also its largest single shareholder, whose 2007-14 tenure at the helm saw Walgreens’ market capitalization shrink to less than $50 billion.
In 2012, Walgreens announced a $5.2 billion investment in primary-care provider VillageMD. That proved to be a cash drain and is now a good exit candidate for Sycamore.
Two years later, Walgreens concluded a two-step acquisition of Swiss-based Alliance Boots, a pharmacy-led health and beauty group that is now considered by analysts as a likely candidate for a spin-off.
The company stuck to its buying spree even after Pessina, snapping up almost 2,000 stores from its former rival Rite Aid Corp in 2018. But that store footprint proved too big and soon after the acquisition, Walgreens started to close locations.
There were also missed opportunities. While its top rival CVS has diversified its business beyond retail, including acquiring U.S. health insurer Aetna for almost $70 billion in 2018, Walgreens turned away from buying insurer Humana.
How did Walgreens’ finances falter?
The company’s market value has shrunk to just more than $9 billion from almost $100 billion a decade ago as margins on drug prices fell and consumers shifted to cheaper rivals Amazon and Walmart to fill their prescriptions and purchase toiletries.
And when rivals diversified into insurance or prescription management, Walgreens invested billions in buying other pharmacy chains despite the trend away from in-store shopping.
As a result, the second-largest U.S. pharmacy chain’s debt and lease obligations have ballooned to almost $30 billion.
“You have a business that is shrinking, and then you layer on losses and cash burn, all of that was the perfect recipe for what we are seeing today,” said Brian Tanquilut, a healthcare services research analyst with Jefferies bank.
What is Sycamore Partners’ background?
Sycamore Partners  is a private equity firm based in New York. The firm specializes in consumer, distribution and retail-related investments and partners with management teams to improve the operating profitability and strategic value of their business.
Its past approach has involved selling the companies’ most valuable assets, and reducing costs in the remaining operations through store closures and other measures, with savings often used to draw dividends and not necessarily aimed at growth.
Where are Walgreens locations in Michigan?
Walgreens has more than 200 stores throughout Michigan in the following cities:
- Adrian: 706 S. Main St.
- Allendale: 6840 Lake Michigan Drive
- Alpena: 1011 W. M-32
- Ann Arbor: 317 S. State St.; 2355 Jackson Ave.; 3255 Washtenaw Ave.; 3500 Washtenaw Ave.
- Bad Axe: 830 N. Van Dyke Road
- Battle Creek: 605 North Ave.; 797 Capital Ave. NE; 50 Columbia Ave. W; 5991 Beckley Road
- Bay City: 1900 Columbus Ave.; 416 S. Euclid Ave.
- Benton Harbor: 875 E. Napier Ave.
- Big Rapids: 1010 S. State St.
- Birmingham: 34300 Woodward Ave.
- Brighton: 8729 W. Grand River Ave.
- Byron Center: 8364 Byron Center Ave. SW
- Cadillac: 1220 N. Mitchell St.
- Canton: 44300 Ford Road
- Charlevoix: 1500 Bridge St.
- Cheboygan: 991 S. Main St.
- Chesterfield: 51008 Gratiot Ave.
- Clare: 1141 N. McEwan St.
- Clarkston: 7110 Dixie Highway
- Clinton Township: 16741 Canal Road; 1045 S. Gratiot Ave.
- Coldwater: 500 E. Chicago St.
- Commerce Township: 2270 Union Lake Road
- Davison: 901 S. State Road
- Dearborn: 15450 Michigan Ave.; 13601 W. Warren Ave.
- Dearborn Heights: 25700 Ford Road; 8706 N. Telegraph Road
- Detroit: 3901 Beaubien St.; 3990 John R. St.; 4201 Saint Antoine St.; 4501 Woodward Ave.; 6331 E. Jefferson Ave.
- Dewitt: 13020 S. U.S. 27
- Dundee: 100 Cabelas Blvd. E
- East Lansing: 100 W. Grand River Ave.
- Eastpointe: 25016 Gratiot Ave.
- Escanaba: 2301 Ludington St.
- Essexville: 2901 Center Ave.
- Farmington Hills: 32395 Northwestern Highway
- Fenton: 3270 W. Silver Lake Road
- Flat Rock: 23007 Telegraph Road
- Flint: 1419 N. Dort Highway; 3336 S. Dort Highway; 502 S. Ballenger Highway; 2284 S. Ballenger Highway; G4010 Fenton Road; 5020 Corunna Road
- Flushing: 1570 E. Pierson Road
- Fraser: 15267 E. 14 Mile Road; 31100 Groesbeck Highway
- Fremont: 819 W. Main St.
- Garden City: 31415 Ford Road
- Gaylord: 1290 W. Main St.
- Grand Blanc: 5703 S. Saginaw Road
- Grand Haven: 510 N. Beacon Blvd.; 1045 Robbins Road
- Grand Ledge: 812 E. Saginaw Highway
- Grand Rapids: 555 Michigan St. NE; 800 Leonard St. NW; 425 Fuller Ave. NE; 1964 Fuller Ave. NE; 1601 Kalamazoo Ave. SE
- Grandville: 3191 28th St. SW
- Grayling: 2045 S I-75 Business Loop
- Greenville: 1420 W. Washington St.
- Hastings: 126 N. Broadway St.
- Highland: 2821 E. Highland Road
- Hillsdale: 196 W. Carleton Road
- Holland: 780 Washington Ave.; 494 Butternut Drive; 12576 Riley St.; 11236 E. Lakewood Blvd.
- Houghton: 1007 Memorial Road
- Howell: 2321 E. Grand River Ave.
- Ionia: 2450 S. State Road
- Iron Mountain: 300 E. F St.
- Ironwood: 802 E. Cloverland Drive
- Jackson: 1314 N. West Ave.; 3040 E. Michigan Ave.
- Jenison: 378 Baldwin St.
- Kalamazoo: 760 W. Michigan Ave.; 3016 S. Westnedge Ave.; 5020 W. Main St.
- Kentwood: 6020 Kalamazoo Ave. SE; 2425 44th St. SE
- Lake Orion: 450 N. Park Boulevard; 3520 S. Baldwin Road
- Lambertville: 7420 Secor Road
- Lansing: 3915 W. Saginaw Highway; 3425 E. Saginaw St.; 3404 S. Martin Luther King Jr. Blvd.; 3520 Forest Road; 410 E. Jolly Road; 6421 W. Saginaw Highway
- Lapeer: 571 S. Main St.
- Lincoln Park: 1765 Fort St.
- Livonia: 8850 Newburgh Road; 33333 6 Mile Road; 29200 6 Mile Road; 17001 Newburgh Road; 33239 8 Mile Road
- Lowell: 11980 Fulton St. E
- Ludington: 33 S. Pere Marquette Highway
- Macomb: 47100 Hayes Road; 21790 21 Mile Road
- Madison Heights: 26800 John R. Road
- Manistee: 1525 S. U.S. 31
- Marquette: 1115 W. Washington St.
- Midland: 931 S. Saginaw Road; 1615 N. Saginaw Road
- Monroe: 484 S. Telegraph Road; 1285 N. Monroe St.
- Mount Pleasant: 1309 S. Mission St.; 903 N. Mission St.
- Muskegon: 1000 S. Getty St.; 840 W. Sherman Blvd.; 1991 E. Apple Ave.
- New Baltimore: 51200 Washington St.
- Niles: 907 S. 11th St.
- North Muskegon: 1771 Holton Road
- Norton Shores: 1171 E. Sherman Blvd.
- Novi: 24100 Novi Road
- Okemos: 2131 W. Grand River Ave.
- Owosso: 1001 E. M 21
- Paw Paw: 848 S. Kalamazoo St.
- Petoskey: 710 Spring St.; 1301 N. U.S. 31
- Plainwell: 1277 M-89
- Port Huron: 1617 10th St.; 1221 Pine Grove Ave.; 3990 24th Ave.
- Portage: 7920 Shaver Road; 5933 S. Westnedge Ave.
- Prudenville: 729 W. Houghton Lake Drive
- Redford: 26000 5 Mile Road
- Riverview: 17071 Fort St.
- Rochester: 1490 N. Rochester Road
- Rochester Hills: 2050 S. Rochester Road; 1280 Walton Boulevard; 2985 Crooks Road
- Royal Oak: 1815 Rochester Road
- Saginaw: 1841 N. Michigan Ave.; 3730 Dixie Highway; 2990 Bay Road; 4989 State St.
- Saint Clair Shores: 29520 Harper Avenue; 25015 Little Mack Avenue; 32201 Harper Avenue; 21211 Harper Avenue
- Saint Johns: 1410 S. U.S. 27
- Saint Joseph: 1260 Hilltop Road
- Sault Ste. Marie: 2101 Ashmun St.
- Shelby Township: 56805 Van Dyke Ave.; 13664 23 Mile Road
- South Haven: 1100 Phoenix St.
- South Lyon: 22318 Pontiac Trail
- Southfield: 15840 W. 12 Mile Road; 23111 Lahser Road; 29030 Northwestern Highway
- Sterling Heights: 43250 Van Dyke Ave.; 4019 Metropolitan Parkway; 2100 18 Mile Road; 13700 Canal Road
- Stevensville: 1710 W. John Beers Road; 4157 Red Arrow Highway
- Sturgis: 950 S. Centerville Road
- Taylor: 9100 Telegraph Road; 22525 Wick Road; 20090 Goddard Road; 20030 Ecorse Road; 15009 Telegraph Road
- Tecumseh: 1330 W. Chicago Blvd.
- Three Rivers: 301 S. U.S. 131
- Traverse City: 3900 N. U.S. 31 S; 975 W. South Airport Road; 2350 N. U.S. 31 N; 1029 S. M-37
- Trenton: 1700 West Road
- Troy: 1965 E. Big Beaver Road
- Van Buren Township: 10276 Belleville Road
- Vassar: 181 W. Huron Ave.
- Walker: 4365 Lake Michigan Drive NW
- Warren: 11635 E. 13 Mile Road; 4010 E. 13 Mile Road; 24900 Schoenherr Road
- Waterford: 4800 Dixie Highway; 20 S. Telegraph Road
- Wayne: 32732 Michigan Ave.
- West Bloomfield: 7380 Orchard Lake Road; 7490 Haggerty Road
- West Branch: 2480 E. Houghton Ave.
- Westland: 7210 N. Middlebelt Road
- Whitehall: 3284 Colby Road
- Wyandotte: 3221 Fort St.
- Wyoming: 1550 36th St. SW; 4425 Division Ave. S; 5575 Byron Center Ave. SW
- Ypsilanti: 2170 Washtenaw Road
USA TODAY and Reuters contributed.
Contact Jenna Prestininzi:Â jprestininzi@freepress.com.
