Walgreens (WBA, Financial) shareholders just signed off on a $10 billion buyout by Sycamore Partners—a move that will take the 123-year-old pharmacy giant private for the first time since 1927. Under the deal, shareholders will receive $11.45 per share, plus a potential kicker of up to $3 tied to future proceeds from Walgreens' VillageMD stake. The stock barely budged on the news, trading around $11.50—right where it's hovered since the deal was announced back in March.
This comes as the entire retail pharmacy sector is under serious pressure. Reimbursement cuts, rising costs, and a consumer shift away from traditional pharmacies have forced companies like Walgreens, CVS, and Rite Aid to radically rethink their footprints. Walgreens alone plans to shutter over 1,000 stores through 2027, after already closing about 1,000 since 2018. Rite Aid, meanwhile, just filed for bankruptcy—again. It's the second time in two years.
Now, with Wall Street off its back, Walgreens could have more room to execute a painful—but possibly necessary—turnaround. CEO Tim Wentworth says Sycamore's backing might help the company move faster on restructuring. Two years ago, shares were trading above $30. Today, investors are walking away with just over a third of that—unless the VillageMD kicker pans out. Whether this move proves to be a reset or just a retreat remains to be seen.
