Reliance-Apollo ahead in Boots race
MUMBAI: A consortium of Reliance Industries Ltd (RIL) and buyout firm Apollo Global Management Inc. has emerged as the strongest contender to acquire Walgreens Boots Alliance Inc.’s Boots pharmacies unit in the UK.
The consortium has valued the assets in the range of $7-8 billion, the people said, without specifying the exact bid. Walgreens, based in a suburb of Chicago, put its Boots business on the block in December, seeking a valuation of $8.8 billion. The US drugstore chain also runs more than 2,200 Boots pharmacies across the UK, Ireland, Italy, Norway, the Netherlands, Thailand, and Indonesia.
If Walgreens accepts the bid by the Mukesh Ambani-led company, it will be the largest crossborder acquisition by India’s most valuable company.
A potential acquisition of Boots will substantially expand RIL’s presence in the healthcare sector. The company had acquired a 60% stake in Chennai-based online pharmacy startup Netmeds in 2020 for ₹620 crore. RIL is likely to be named the winning bidder soon, said one of the people 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 May 31, but things got a bit delayed. The name of the winning bidder will be announced shortly,” the person said.
A spokesperson for Walgreens Boots declined to comment. A spokesperson Apollo Global did not respond to emails seeking comment. 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 with a strategy to strengthen its foothold 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 country’s largest telecom operator. The buyout firms acquired the 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 space. 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 monetized through transaction-based services, delivery and subscriptions.