Walgreens Sells Itself to Sycamore... Not Amazon

Walgreens Boots Alliance has reportedly found a buyer, and no, it’s not Amazon. Private equity firm Sycamore Partners is said to be closing in on a deal to acquire the retail pharmacy giant, with an agreement potentially finalizing early next year, according to The Wall Street Journal. The news sent Walgreens shares soaring nearly 25% on Tuesday because if there’s one thing Wall Street loves, it’s PE swooping in to flip a struggling business.

The timing makes sense: Walgreens has been limping through a rough stretch. The pharmacy titan is grappling with the post-COVID retail slump, brutal reimbursement pressures, and a poorly executed pivot into healthcare. Its last two quarters missed Wall Street’s earnings expectations, and it plans to shutter 1,200 stores in the next three years, with 500 closures in fiscal 2025 alone. About a quarter of its 8,700 U.S. stores are already operating in the red.

This isn’t Walgreens’ first dance with private equity. Back in 2019, KKR floated a $70 billion buyout offer, but the deal fizzled. Now, Sycamore appears to have sealed the deal, stepping in to play fixer-upper with what was once a retail pharmacy powerhouse.

Amazon watchers might wonder why Jeff Bezos’ empire didn’t make a play. After all, turning Walgreens into Prime’s pharmacy hub could’ve been a game-changer. But for now, the company’s fate is firmly in Sycamore’s hands, setting the stage for a classic PE turnaround… or, y’know, PE teardown.