Boots in $10bn sale talks as parent company weighs alternatives to London IPO

Boots' parent company Sycamore Partners is in talks over a possible sale of the UK health and beauty giant with an estimated valuation of around $10 billion (£7.5 billion), according to reports by the Financial Times.

One of the interested parties that were named in the discussions was the Weston family, owners of the the parent company of Primark, Associated British Foods. They also own Canadian retail pharmacy chain Shoppers Drug Mart.

Australian pharmacy group Sigma Healthcare has also confirmed on Wednesday that it has held "preliminary discussions" over a takeover.

The company stressed to shareholders that there is "no certainty" any transaction will take place.

A sale would mark a change of direction for Boots and its parent company, which until recently were reported to be working with consultants on a strategy overhaul in preparation for a possible London listing in 2027. The advisors had also been tasked with exploring growth initiatives across the beauty and wellness sectors.

At the time, sources familiar with the plans told Reuters that discussions were at a preliminary stage, while one source noted that a sale remained possible given private equity interest in the business.

The latest reports of a potential sale follow the appointment of a new CEO for Boots, announced in May. Alex Baldock, the former Currys boss, was confirmed to be joining Boots as Chief Executive in the autumn. The appointment was considered to be a further milestone in the health and beauty retailer's ongoing business transformation.

Former Boots CEO Ornella Barra stepped down from the role in January to become Chair, with Anthony Hemmerdinger, Senior Vice President and Managing Director of Boots UK, Ireland, Opticians and No7 Beauty Company, tasked with leading the business in the interim.

The reported sale talks come as Boots has been investing in its beauty and wellness credentials. Boots today operates over 1,800 stores across Britain, selling health and beauty products as well as pharmacy services. In May it further added to its portfolio, opening its second beauty-only concept store at Cabot Circus in Bristol in May.

The 11,000 sq ft location carries more than 200 beauty brands across skincare, haircare, fragrance, cosmetics, wellness and electrical beauty categories, and is the retailer's first standalone beauty concept outside London following its 2023 launch at Battersea Power Station.

This isn't the first time that rumours about a sale have emerged.

Boots was previously put up for sale with a price tag of £7 billion in January 2022. However, this was called off in June 2022 after the business failed to find a suitable buyer.

In 2023, rumours again circulated of a potential sale of Boots UK, following pressure from its US parent company to break up Walgreens Boots Alliance.

Boots traces its roots back to 1849 when John Boot opened his first store and completed its mega-merger with Walgreens in 2014.