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Walgreens Boots Alliance to Acquire 40% of Chinese Pharmacy Chain GuoDa for USD 416m
Wednesday 06 December 2017

6 December 2017 - US-based drugstore chain operator Walgreens Boots Alliance, Inc. (NASDAQ: WBA) has reached an agreement with China National Accord Medicines Corp. Ltd. to become an investor in its subsidiary Sinopharm Holding Guoda Drugstores Co., Ltd. which operates and franchises retail pharmacies across China, the company said on Wednesday.

Following a public tender process, Walgreens Boots Alliance's bid met all the requirements set by the seller to acquire a 40% minority stake in GuoDa through a capital increase worth RMB 2.767bn (around USD 416m).

The transaction is subject to regulatory review and approval, and other customary closing conditions. Upon completion, Walgreens Boots Alliance would account for this stake as an equity method investment.

GuoDa is a retail pharmacy chain in China, and has been pursuing its vision for expansion across the country in the context of the ongoing healthcare reforms and increasing importance of the pharmacy channel in the country.

Walgreens Boots Alliance, as a global pharmacy-led enterprise, believes it is well positioned to provide its significant expertise to GuoDa and support its growth ambitions.

Sinopharm Holding Guoda Drugstore is a large national pharmacy chain in China.

It is China National Pharmaceutical Group Corp.'s (CNPGC) retail pharmacy platform, established in March 2004 and headquartered in Shanghai.

GuoDa operates more than 3,500 retail pharmacies across around 70 cities, and employs close to 20,000 people. In 2016, GuoDa was consolidated into China National Accord Medicines Corp. Ltd. (Shenzhen Stock Exchange/A Share:000028).

After over 10 years of rapid growth, GuoDa has developed national coverage across 19 provinces, autonomous regions and municipalities.

In line with CNPGC's strategy to further grow the State-owned pharmaceutical and healthcare business, GuoDa aims to take advantage of the unprecedented opportunities created by the Chinese healthcare reform to further expand nationwide.

Walgreens Boots Alliance has more than 13,200 stores in 11 countries as well as one of the largest global pharmaceutical wholesale and distribution networks, with more than 390 distribution centres delivering to more than 230,000 pharmacies, doctors, health centers and hospitals each year in more than 20 countries.

In addition, Walgreens Boots Alliance is one of the world's largest purchasers of prescription drugs and many other health and wellbeing products.

The company's portfolio of retail and business brands includes Walgreens, Duane Reade, Boots and Alliance Healthcare, as well as increasingly global health and beauty product brands, such as No7, Soap and Glory, Liz Earle, Sleek MakeUP and Botanics.
Details
Date Published: 06/12/2017
Target: Sinopharm Holding Guoda Drugstores/40% stake
Country: China
Deal Size: 416m (USD)
Sector: Wholesale/Retail
Type: JV
Financing: Cash
Status: Agreed
Vendor: China National Accord Medicines Corp
Buyer: Walgreens Boots Alliance
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