After months of rumors and speculation, Walgreens has finally announced it is being sold for nearly $10 billion in cash, or approximately $17 billion if we include debt. Although many already know Walgreens as a retail giant, it has been making a significant push into the healthcare market for the past years, but that plan has backfired. According to its annual report for fiscal year 2024, the company reported an operating loss of $14.1 billion (yes, billion), largely due to the loss in value of VillageMD, its primary care subsidiary and the principal vehicle for its healthcare initiative.
Walgreens’ healthcare strategy was on display in the M&A market; in addition to the company’s $5.2 billion investment in VillageMD in 2021, it also bought Shields Health Solutions for $1.37 billion and CareCentrix, Inc., a home health company, for $330 million.
After Walgreens’ investment, VillageMD kept expanding, announcing 12 deals since 2021, including an $8.9 billion acquisition for Summit Health-CityMD, a popular urgent care and primary care network in the New York City area.
That massive spending spree put Walgreens in hot water, enough for it to explore a sale of its own that came to light late on March 6, 2025. The buyer, private equity firm Sycamore Partners, is offering $11.45 per share in cash at closing and also $3 in cash per share “from the future monetization of Walgreen’s debt and equity interests in VillageMD, which includes the Village Medical, Summit Health and CityMD businesses,” as noted in the press release.
Sycamore Partners is a private equity firm based in New York specializing in consumer, distribution and retail-related investments. The firm has approximately $10 billion in aggregate committed capital. This is the firm’s first forway into the healthcare industry, it seems, but it does have plenty of investments in the retail space.
Following the close of the deal, Walgreens will be taken private and will no longer be publicly traded.
