Walgreens Boots Alliance to Invest in Chinese Pharmacy Chain GuoDa

10:54 12/06/2017

Walgreens Boots Alliance, Inc. [Nasdaq:WBA] has reached an agreement to invest in China National Accord Medicines Corporation’s subsidiary, Sinopharm Holding GuoDa Drugstores Co., Ltd. GuoDa operates and franchises retail pharmacies across China, and Walgreens Boots Alliance’s [Nasdaq:WBA] bid met all of the seller’s requirements. WBA will acquire a 40 percent minority stake in GouDa via a capital increase worth RMB2.767 billion. The agreement is still subject to regulatory review and approval and typical closing conditions.

Executive Vice Chairman and CEO Stefano Pessina said, “We are very pleased to become a strategic investor in GuoDa. It is China’s leading pharmacy chain and we believe that we can positively contribute to its continued successful development with our global pharmacy expertise. We have had a presence in China for around 10 years, initially through Alliance Boots, and we are excited about the opportunity to further invest in the country’s fast growing retail pharmacy sector.”

Upon deal completion, Walgreens Boots Alliance will account for this stake as an equity method investment. GouDa is one of the largest retail pharmacy chains in China, and is eager to expand across the vast country. The timing could not be better, as there are ongoing reforms in healthcare and increased importance placed on the country’s pharmacy channel. GouDa is headquartered in Shanghai and was formed in 2004 and currently operates more than 3,500 retail pharmacies across around 70 cities, and employs close to 20,000 people.

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.

This article has been provided by a Chasing Markets contributor. All content submitted by this author represent their personal opinions, and should be considered as such for entertainment purpose only. All opinions expressed are those of the writer, and may not necessarily represent fact, opinions, or bias of Chasing Markets.
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