Walgreens Boots Alliance Sells Shares of Cencora for Approximately $1.1 Billion of Proceeds
Walgreens Boots Alliance (WBA) has announced the sale of its remaining unencumbered shares of Cencora, Inc. (COR) for approximately $1.1 billion. The transaction includes an $818 million sale pursuant to Rule 144 and a $250 million concurrent share repurchase by Cencora. This move reduces WBA's ownership of Cencora from about 12% to 10%. The proceeds will be primarily used for debt paydown and general corporate purposes, aligning with WBA's strategy to develop a more capital-efficient health services model based on its retail pharmacy network. Importantly, the sale does not affect the long-term strategic partnership between WBA and Cencora, which has been in place since 2013. Ornella Barra, WBA's Chief Operating Officer, International, will continue to serve on Cencora's Board of Directors.
Walgreens Boots Alliance (WBA) ha annunciato la vendita delle sue ultime azioni non gravate di Cencora, Inc. (COR) per circa 1,1 miliardi di dollari. La transazione include una vendita di 818 milioni di dollari ai sensi della Regola 144 e un riacquisto contemporaneo di azioni da parte di Cencora per 250 milioni di dollari. Questa mossa riduce la partecipazione di WBA in Cencora dal 12% circa al 10%. I proventi saranno utilizzati principalmente per riduzione del debito e scopi aziendali generali, in linea con la strategia di WBA di sviluppare un modello di servizi sanitari più efficiente in termini di capitale basato sulla sua rete di farmacie al dettaglio. È importante notare che la vendita non influisce sulla partnership strategica a lungo termine tra WBA e Cencora, attiva dal 2013. Ornella Barra, Chief Operating Officer Internazionale di WBA, continuerà a far parte del Consiglio di Amministrazione di Cencora.
Walgreens Boots Alliance (WBA) ha anunciado la venta de sus acciones restantes sin gravamen de Cencora, Inc. (COR) por aproximadamente 1.1 mil millones de dólares. La transacción incluye una venta de 818 millones de dólares según la Regla 144 y una recompra concurrente de acciones por parte de Cencora de 250 millones de dólares. Este movimiento reduce la participación de WBA en Cencora del 12% aproximadamente al 10%. Los ingresos se utilizarán principalmente para reducción de deuda y propósitos corporativos generales, alineándose con la estrategia de WBA de desarrollar un modelo de servicios de salud más eficiente en capital basado en su red de farmacias minoristas. Es importante destacar que la venta no afecta la asociación estratégica a largo plazo entre WBA y Cencora, que existe desde 2013. Ornella Barra, Directora de Operaciones Internacionales de WBA, continuará formando parte de la Junta Directiva de Cencora.
월그린 부츠 얼라이언스(WBA)는 센코라(Cencora, Inc.)(COR)의 남아 있는 비담보 주식을 약 11억 달러에 매각한다고 발표했습니다. 이번 거래는 규칙 144에 따른 8억 1,800만 달러의 판매와 센코라의 동시 주식 매입 2억 5,000만 달러를 포함합니다. 이로 인해 WBA의 센코라 소유 비율은 약 12%에서 10%로 줄어듭니다. 수익금은 주로 부채 상환 및 일반 회사 용도에 사용되며, 이는 WBA의 소매 약국 네트워크에 기반한 보다 자본 효율적인 건강 서비스 모델 개발 전략과 일치합니다. 중요하게도, 이번 매각은 2013년부터 체결된 WBA와 센코라 간의 장기 전략적 파트너십에는 영향을 미치지 않습니다. WBA의 국제 COO인 오르넬라 바르라(Ornella Barra)는 센코라 이사회에서 계속 활동할 것입니다.
Walgreens Boots Alliance (WBA) a annoncé la vente de ses dernières actions non grevées de Cencora, Inc. (COR) pour environ 1,1 milliard de dollars. La transaction comprend une vente de 818 millions de dollars conformément à la Règle 144 et un rachat d'actions concomitant par Cencora d'un montant de 250 millions de dollars. Ce mouvement réduit la participation de WBA dans Cencora d'environ 12% à 10%. Les produits seront principalement utilisés pour le remboursement de dettes et des fins d'entreprise générales, conformément à la stratégie de WBA visant à développer un modèle de services de santé plus efficace en capital, basé sur son réseau de pharmacies de détail. Il est important de noter que la vente n'affecte pas le partenariat stratégique à long terme entre WBA et Cencora, établi depuis 2013. Ornella Barra, Directrice des opérations internationales de WBA, continuera de siéger au Conseil d'administration de Cencora.
Walgreens Boots Alliance (WBA) hat den Verkauf seiner verbleibenden unbelasteten Anteile an Cencora, Inc. (COR) für etwa 1,1 Milliarden Dollar angekündigt. Die Transaktion umfasst einen 818 Millionen Dollar Verkauf gemäß Regel 144 sowie einen 250 Millionen Dollar zeitgleichen Aktienrückkauf durch Cencora. Dieser Schritt reduziert den Besitz von WBA an Cencora von etwa 12% auf 10%. Die Erlöse werden hauptsächlich für Schuldenabbau und allgemeine Unternehmenszwecke verwendet, was im Einklang mit WBAs Strategie steht, ein kapitaleffizienteres Gesundheitsdienstleistungsmodell basierend auf seinem Einzelhandelsapothekennetzwerk zu entwickeln. Wichtig ist, dass der Verkauf die langfristige strategische Partnerschaft zwischen WBA und Cencora, die seit 2013 besteht, nicht berührt. Ornella Barra, die COO International von WBA, wird weiterhin im Vorstand von Cencora tätig sein.
- Sale of Cencora shares generates approximately $1.1 billion in proceeds for WBA
- Proceeds to be used primarily for debt reduction, improving WBA's financial position
- Maintains strategic partnership with Cencora, preserving long-term business relationship
- Aligns with WBA's strategy to develop a more capital-efficient health services model
- Reduction in ownership stake in Cencora from 12% to 10%, potentially decreasing future dividend income
- Possible dilution of influence over Cencora's operations due to reduced ownership
Insights
The sale of Walgreens Boots Alliance's (WBA) remaining unencumbered shares in Cencora for
- Debt Reduction: WBA's primary use of the proceeds for debt paydown is a prudent financial decision. This could improve the company's balance sheet, potentially leading to lower interest expenses and enhanced financial flexibility.
- Ownership Shift: The reduction in WBA's ownership of Cencora from
12% to10% represents a strategic realignment. While maintaining a significant stake, this move allows WBA to unlock capital while preserving its partnership with Cencora. - Capital Efficiency: The transaction aligns with WBA's stated goal of building a more capital-efficient health services strategy. This could signal a shift towards optimizing its core retail pharmacy business and related health services.
However, investors should note that while this move provides immediate financial benefits, it also slightly reduces WBA's exposure to Cencora's potential future growth. The maintenance of the strategic partnership and board representation suggests that WBA still values the relationship, balancing immediate financial needs with long-term strategic interests.
This transaction by Walgreens Boots Alliance (WBA) reflects broader trends in the healthcare and retail pharmacy sectors:
- Strategic Partnerships: The maintenance of the WBA-Cencora partnership, despite the share sale, underscores the importance of strategic alliances in the evolving healthcare landscape. These partnerships often provide competitive advantages and operational efficiencies.
- Focus on Core Competencies: WBA's move to build out a 'capital-efficient health services strategy rooted in its retail pharmacy footprint' aligns with industry trends of focusing on core strengths while adapting to changing market dynamics.
- Financial Flexibility: In an era of rising interest rates and economic uncertainty, companies are prioritizing financial flexibility. WBA's decision to use the proceeds primarily for debt reduction is in line with this trend.
From a market perspective, this move may be viewed positively as it demonstrates WBA's proactive approach to capital management and strategic focus. However, it's important to monitor how WBA leverages its retail pharmacy footprint to drive growth in health services, as this will be key to long-term value creation in an increasingly competitive healthcare market.
The transaction announced by Walgreens Boots Alliance (WBA) involves some intricate legal and regulatory aspects that merit attention:
- Rule 144 Compliance: The sale of
$818 million worth of shares pursuant to Rule 144 of the Securities Act indicates that WBA is likely selling restricted or control securities. This rule provides a safe harbor from registration requirements, allowing for the public resale of restricted securities if specific conditions are met. - Share Repurchase Agreement: The
$250 million share repurchase by Cencora, contingent on the completion of the Rule 144 sale, suggests a carefully structured transaction. This arrangement likely required meticulous legal drafting to ensure compliance with securities laws and to protect both parties' interests. - Insider Considerations: Given Ornella Barra's continued presence on Cencora's Board, there may be additional insider trading considerations and disclosure requirements to navigate.
From a governance perspective, the maintenance of board representation despite the reduced ownership stake is noteworthy. This arrangement preserves WBA's influence in Cencora while allowing for capital reallocation, demonstrating a nuanced approach to corporate governance and strategic partnerships.
Overall, this transaction showcases the complex interplay of securities law, corporate governance and strategic financial management in major corporate decisions.
Transaction Highlights
-
Walgreens Boots Alliance announces sale of all remaining unencumbered shares of Cencora, Inc. for proceeds of approximately
$1.1 billion -
$818 million $250 million - Proceeds to Walgreens Boots Alliance will be used primarily for debt paydown and general corporate purposes
- No change to ongoing collaboration and long-term strategic partnership
Walgreens Boots Alliance’s ownership of Cencora’s common stock has decreased from approximately 12 percent to approximately 10 percent.
Proceeds to Walgreens Boots Alliance will be used primarily for debt paydown and general corporate purposes, as the company continues to build out a more capital-efficient health services strategy rooted in its retail pharmacy footprint.
The sale has no impact to the long-term partnership between the two companies. Walgreens Boots Alliance remains fully committed to the strategic, mutually beneficial relationship with Cencora, which has been a strong and trusted partner since 2013. Chief Operating Officer, International of Walgreens Boots Alliance, Ornella Barra, will continue to serve on Cencora’s Board of Directors.
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 12,500 locations across the
WBA employs more than 330,000 people and has a presence in eight countries through its portfolio of consumer brands: Walgreens, Boots, Duane Reade, the No7 Beauty Company and Benavides in
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.
More Company information is available at www.walgreensbootsalliance.com.
(WBA-GEN)
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Source: Walgreens Boots Alliance
FAQ
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