Alliance Boots

Establishment

Following a short period of speculation amongst financial analysts, it was announced in October 2005 that Boots Group would merge with Alliance UniChem in a deal valuing both companies equally and said to be worth around £7 billion. Rival firm Celesio, owner of the Lloyds Pharmacy chain, challenged the deal, although were rejected by the Competition Appeal Tribunal. The merger received final approval from the Office of Fair Trading in February 2006 and completed on 1 August 2006, although 96 shops were sold to comply with a condition laid down by the OFT. Former Boots Group shareholders held 50.2% of the new company, with former Alliance UniChem shareholders owning 49.8%.

Acquisition by Stefano Pessina and KKR

On 25 April 2007, Alliance Boots was approached with a buy-out offer by New York City-based private equity firm Kohlberg Kravis Roberts in conjunction with Alliance Boots' then Executive Deputy Chairman, Stefano Pessina, for an estimated £12.4 billion. Alliance Boots was the first company on the FTSE 100 share index to be bought-out by a private equity firm. Almost £9 billion was advanced by investment banks, including Deutsche Bank, Citigroup, J.P. Morgan, UniCredit, Barclays, Merrill Lynch, the Bank of America and the Royal Bank of Scotland. Simultaneously the banks, as so-called "equity underwriters“, together invested around £1.4 billion in the buyout company. The reverse takeover and subsequent privatisation was dubbed as "the best deal ever struck" by a managing partner at a private equity firm in June 2008.

Alliance Boots GmbH was established in Switzerland during 2008 and is a direct subsidiary of AB Acquisitions Holdings Limited, a company which owns 55% of Alliance Boots GmbH's shares.

Walgreens merger

It was announced on 19 June 2012 that Walgreens would purchase a partial stake in Alliance Boots, as the first step in a three-year merger plan. Walgreens paid $6.7 billion for this share, and subsequently on 6 August 2014 Walgreens exercised its option to complete the second step of its strategic transaction with Alliance Boots to create the first global pharmacy-led health and beauty retailer, with over 12,000 stores worldwide. The two companies had established Walgreens Boots Alliance Development Company in late 2012 to further their integration. The first publicly visible sign of the merger came in November 2012 when Boots skincare brand No7 debuted in a Walgreens store in Los Angeles, with a view to further rolling out the Boots brand across the US.

Walgreens' shareholders approved the purchase on 29 December 2014, and it was completed on 31 December. Under the terms of the merger, the two companies became subsidiaries of a new holding company, Walgreens Boots Alliance Inc. which remains headquartered in Deerfield, Illinois. The new company is organised into four divisions, of which Walgreens and Boots each became one. The two remaining divisions are Pharmaceutical Wholesale and International Retail, which includes Alliance Healthcare, and Global Brands.

Operations

Alliance Boots operations are split into two areas, pharmacy-led health and beauty retailing and pharmaceutical wholesaling and distribution. The Group also has a stand-alone contract manufacturing business called BCM and increasingly develops and internationalises its product brands.

Boots UK

Boots UK formed the main retail business of Alliance Boots in the United Kingdom, and all former Alliance Pharmacy branches were rebranded as Boots. The Boots brand has a history stretching back over 160 years and is a familiar sight on Britain's high streets. Boots stores are located in prominent high street and city centre locations as well as in local communities. Most branches include a pharmacy, and focus on healthcare, personal care and cosmetic products, with most stores selling over the counter medicines.

Larger stores typically offer a variety of healthcare services in addition to dispensing prescriptions, such as flu vaccination, cholesterol screening, weight loss advice, hair retention treatment, smoking cessation advice and products, and chlamydia testing & treatment (private service). Optician services are also offered in many larger stores, with Boots Opticians providing eye tests along with the sale of spectacles and contact lenses.

Many stores also feature traditional photo processing and/or a Kodak picture kiosk where users of digital cameras and camera phones can create prints. Larger stores usually offer a range of electrical equipment such as hairdryers, curlers and foot massagers, whilst selected stores offer a range of sandwiches, baguettes, wraps, salads and beverages.