RIL teams up with Apollo in bid to acquire Boots pharma chain
10 Jun 2022
Reliance Industries Ltd (RIL) has teamed up with buyout firm Apollo Global Management Inc to acquire Walgreens Boots Alliance Inc’s Boots pharmacies unit in the UK, reports citing people involved in the matter said.
The exact offer is yet to be unveiled. However, the consortium is reported to have emerged as the strongest contender with its valuation of $7-8 billion for the pharmacy chain.
RIL is likely to be named the winning bidder soon, said one of the sources cited above. Walgreens may retain a stake in the business after the deal, the person added, requesting anonymity.
“RIL-Apollo Global looks likely to be announced as the winner of the binding bidding round. The last day for shortlisting the bidder was 31 May, but things got a bit delayed. The name of the winning bidder will be announced shortly," the person said.
Walgreens put its Boots business on the block in December, seeking a valuation of $8.8 billion. The US drugstore chain runs more than 2,200 Boots pharmacies across the UK, Ireland, Italy, Norway, the Netherlands, Thailand, and Indonesia.
If the Chicago based Walgreens accepts the bid by the Reliance-led consortium, it will be the largest cross-border acquisition by the Mukesh Ambani-led company.
A potential acquisition of Boots will substantially expand RIL’s presence in the healthcare sector. The company had acquired a 60 per cent stake in Chennai-based online pharmacy startup Netmeds in 2020 for Rs620 crore.
An RIL spokesperson said, “As a policy, we do not comment on media speculation and rumours. Our company evaluates opportunities on an ongoing basis."
A consortium backed by British billionaire brothers Mohsin and Zuber Issa, co-founders of Euro Garages (the owner of a chain of petrol filling stations) and the majority stakeholders in supermarket group Asda (held through a consortium with TDR Capital), withdrew from the race after they failed to agree on the valuation, the people said, citing news reports.
Over the past year, RIL has been on an acquisition spree to strengthen its presence across sectors and markets. Last year, it narrowly lost out to a consortium of private equity investors Apax Partners LLC and Warburg Pincus LLC for a controlling stake in T-Mobile Netherlands BV. The buyout firms acquired the top Dutch telecom firm for €5.1 billion ($6 billion) from Deutsche Telekom AG.
RIL has also made a series of acquisitions in the healthcare and pharma sectors. These include purchase of majority stakes in Karexpert and C-Square. RIL is integrating its brick-and-mortar network through its digital arm Jio Platforms to offer a bouquet of services that can be monetised through transaction-based services, delivery and subscriptions.