Walgreens Boots Alliance Sells Shares of AmerisourceBergen Corporation for $1.85 Billion of Initial Proceeds

Rhea-AI Summary

Walgreens Boots Alliance (WBA) Announces Sale of AmerisourceBergen (ABC) Shares and Concurrent Share Repurchase, Generating $1.6 Billion in Current Proceeds. The sale was executed through prepaid variable share forward transactions, providing liquidity while maintaining the ability to participate in potential stock price appreciation. The proceeds will be used for debt paydown and general corporate purposes.

Positive

• The sale of shares and concurrent share repurchase will provide Walgreens Boots Alliance with significant liquidity, allowing the company to pay down debt and fund general corporate purposes.
• The prepaid variable share forward transactions enable Walgreens Boots Alliance to maintain the potential for stock price appreciation while generating immediate proceeds.
• The planned settlement of the prepaid variable share forward transactions at two maturities in 2026 indicates a long-term strategic financial planning approach by Walgreens Boots Alliance.

Negative

• None.

Transaction Highlights

• Walgreens Boots Alliance announces the sale of shares of AmerisourceBergen Corporation pursuant to prepaid variable share forward transactions executed through a registered public offering for current proceeds of approximately $1.6 billion and, depending on the stock price at the time, potentially additional proceeds at maturity, along with a concurrent share repurchase by AmerisourceBergen of approximately $250 million
• Prepaid variable share forward transactions provide liquidity while maintaining ability to participate in potential stock price appreciation
• Proceeds to Walgreens Boots Alliance will be used primarily for debt paydown and general corporate purposes

DEERFIELD, Ill.--(BUSINESS WIRE)-- Walgreens Boots Alliance, Inc. (Nasdaq: WBA) today announced that it has sold shares of AmerisourceBergen Corporation (NYSE: ABC) (“AmerisourceBergen”) common stock pursuant to prepaid variable share forward transactions executed through a registered public offering for current proceeds of approximately $1.6 billion. In addition, Walgreens Boots Alliance entered into a concurrent share repurchase by AmerisourceBergen for proceeds of approximately $250 million, subject to the consummation of the purchase and sale of the shares of AmerisourceBergen in the registered public offering.

Walgreens Boots Alliance’s ownership of AmerisourceBergen’s common stock has not been impacted by the entry into the prepaid variable share forward transactions, but is expected to decrease as a result of the concurrent share repurchase by AmerisourceBergen to approximately 16 percent.

The prepaid variable share forward transactions are scheduled to settle at two maturities, the first starting in the first quarter of fiscal year 2026 and the second starting in the third quarter of fiscal year 2026, at which time Walgreens Boots Alliance intends to deliver 10.5 million shares of AmerisourceBergen common stock in the aggregate to the counterparties to the transactions, and may receive additional proceeds up to $517 million depending on the stock price at the time.

Proceeds to Walgreens Boots Alliance will be used primarily for debt paydown and general corporate purposes.

Cautionary Note Regarding Forward-Looking Statements: This release contains forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These include, without limitation, estimates of and goals for future operating and financial performance and results. All statements in the future tense and all statements accompanied by words such as “scheduled,” "starting," “intends,” “deliver,” “may,” “depending,” “will,” “continue,” and variations of such words and similar expressions are intended to identify such forward-looking statements.

These forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and assumptions, known or unknown, that could cause actual results to vary materially from those indicated or anticipated.

If one or more of these risks or uncertainties materializes, or if underlying assumptions prove incorrect, actual results may vary materially from those indicated or anticipated by such forward-looking statements. All forward-looking statements Walgreens Boots Alliance makes or that are made on its behalf are qualified by these cautionary statements. No undue reliance should be placed on forward-looking statements, which speak only as of the date they are made.

Walgreens Boots Alliance does not undertake, and expressly disclaims, any duty or obligation to update publicly any forward-looking statement after the date of this release, whether as a result of new information, future events, changes in assumptions or otherwise.

AmerisourceBergen has filed a registration statement (including a prospectus supplement) with the SEC for the registered offering to which this communication relates. These documents can be obtained for free by visiting EDGAR on the SEC Web site at www.sec.gov. Alternatively, a written copy of the prospectus supplement relating to the offering may be obtained by contacting: Goldman Sachs & Co. LLC, Prospectus Department, 200 West Street, NewYork, NY 10282, telephone: 1-866-471-2526, facsimile: 212-902-9316 or by emailing Prospectus-ny@ny.email.gs.com. The closing of the concurrent share repurchase will be conditioned upon the consummation of the purchase and sale of the shares of AmerisourceBergen in the registered public offering, and therefore there can be no assurance that the concurrent share repurchase will be completed. The offering is not conditioned upon the completion of the concurrent share repurchase.

About Walgreens Boots Alliance

Walgreens Boots Alliance (Nasdaq: WBA) is an integrated healthcare, pharmacy and retail leader serving millions of customers and patients every day, with a 170-year heritage of caring for communities.

A trusted, global innovator in retail pharmacy with approximately 13,000 locations across the U.S., Europe and Latin America, WBA plays a critical role in the healthcare ecosystem. The company is reimagining local healthcare and well-being for all as part of its purpose – to create more joyful lives through better health. Through dispensing medicines, improving access to a wide range of health services, providing high quality health and beauty products and offering anytime, anywhere convenience across its digital platforms, WBA is shaping the future of healthcare.

WBA employs more than 325,000 people and has a presence in nine countries through its portfolio of consumer brands: Walgreens, Boots, Duane Reade, the No7 Beauty Company, Benavides in Mexico and Ahumada in Chile. Additionally, WBA has a portfolio of healthcare-focused investments located in several countries, including China and the U.S.

The company is proud of its contributions to healthy communities, a healthy planet, an inclusive workplace and a sustainable marketplace. WBA has been recognized for its commitment to operating sustainably: the company is an index component of the Dow Jones Sustainability Indices (DJSI) and was named to the 100 Best Corporate Citizens 2022.

WBA-GEN

View source version on businesswire.com: https://www.businesswire.com/news/home/20230803546314/en/

WBA Media Relations

USA / Jim Cohn, +1 224 813 9057

International, +44 (0)20 7980 8585



WBA Investor Relations

Tiffany Kanaga, +1 847 315 2922

Source: Walgreens Boots Alliance

FAQ

What is the purpose of the sale of AmerisourceBergen shares by Walgreens Boots Alliance?

The purpose of the sale is to generate approximately $1.6 billion in current proceeds, which will be primarily used for debt paydown and general corporate purposes.

How will the prepaid variable share forward transactions benefit Walgreens Boots Alliance?

The prepaid variable share forward transactions provide liquidity while maintaining the ability to participate in potential stock price appreciation, offering a strategic financial planning approach for the company.

What is the expected impact of the sale and share repurchase on Walgreens Boots Alliance's ownership of AmerisourceBergen?

While the sale and share repurchase will not impact Walgreens Boots Alliance's ownership of AmerisourceBergen's common stock, it is expected to decrease to approximately 16 percent due to the concurrent share repurchase by AmerisourceBergen.