Walgreens 2012 Annual Report Download - page 8

Walgreens and Alliance Boots are
forming a strategic partnership to
create the first global pharmacy-led,
health and wellbeing enterprise.
Alliance Boots two main business
activities – pharmacy-led, health and
beauty retailing and pharmaceutical
wholesaling and distribution
(pictured above) – are essential to
its market-leading position in Europe
and growth in key emerging markets.
Combine that with Walgreens leading
position in the United States, and
together the two companies have
more than 350,000 employees
(including associates and joint
ventures) and generate more than
$100 billion in revenue across
26 countries.
working well together
2012 will go down in Walgreens history as the year the Company expanded its
horizons across oceans, national borders and new languages. In announcing a
strategic partnership with Alliance Boots in June, Walgreens gained a presence
in three additional continents and took a step toward becoming the first global
pharmacy-led, health and wellbeing enterprise. This strategic partnership brings
together two great companies with iconic brands as a major component of
Walgreens growth strategy to expand across new channels and markets.
In August 2012, the two companies announced Walgreens had completed its
initial investment in their strategic partnership. This investment, which consists
of approximately $4.0 billion in cash and 83.4 million shares of Walgreens common
stock in exchange for a 45 percent equity stake in Alliance Boots, also gives Walgreens
the option to proceed to a full combination in approximately three years by acquiring the
remaining 55 percent of Alliance Boots. Walgreens initial investment and option exclude
the Alliance Boots minority interest in Galenica Ltd., the Swiss healthcare group.
The Alliance Boots investment in Galenica continues to be owned by Alliance Boots for
the benefit of its shareholders other than Walgreens.
Back in 2007, Walgreens primary growth driver was opening new stores. That year,
the Company cut the ribbon on a new store every 17 hours. Today, with nearly 8,000
retail health and daily living stores on the best corners in America, Walgreens strategy
has transitioned from purely new store growth to expansion into new markets and
new ways of reaching the customer.
Walgreens believes Alliance Boots is a perfect fit for that new growth strategy. The two
companies’ complementary geographic footprints, shared values and rich histories
of trusted healthcare services date back more than 100 years. As the U.K.’s leading
pharmacy-led, health and beauty retailer, Boots helps customers look and feel better
than they ever thought possible. Throughout its history, Boots has provided high-
quality health and beauty products at affordable prices. In 2006, Stefano Pessina had
the idea to merge Alliance UniChem, PLC, a leading pharmaceutical wholesaling and
retail pharmacy group, with Boots Group PLC to form Alliance Boots.
Today, Alliance Boots continues to expand internationally, focusing on two main lines
of business: pharmacy-led, health and beauty retailing, and pharmaceutical wholesaling
and distribution. Including associates and joint ventures, Alliance Boots has more than
3,300 retail stores in 11 countries, unified with one purpose: to help people look and feel
their best. It also operates the largest international pharmaceutical wholesaler network
in Europe, serving more than 170,000 pharmacies, doctors, health centers and hospitals.
If Walgreens exercises its option to acquire the remaining 55 percent of Alliance Boots,
the two companies together would become the world leader in pharmacy-led health
and wellbeing, with the largest international pharmaceutical wholesale network in
the industry. They would also be the largest buyer of prescription drugs in the world.
Combining strengths and expertise, Walgreens and Alliance Boots plan to build a
worldwide healthcare platform for the future that provides innovative ways to address
global health and wellbeing challenges.
6 2012 Walgreens Annual Report
Walgreens +
Alliance Boots