US pharmacy chain Walgreens has bought a 45% stake in Alliance Boots for $6.7bn (£4.3bn).
Walgreens has an option to buy the business outright in three years’ time from private equity owner KKR, which retains a 55% stake.
The two parties said the merger would create “the first global pharmacy-led, health and wellbeing enterprise”. The combined business would have 11,000 stores in 12 countries and a pharmaceutical wholesaling and distribution network of 370 centres.
“The fit is natural,” said Alliance Boots executive chairman Stefano Pessina. “Walgreen’s consumer profile in the US is similar to Boots in the UK in many ways – a trusted and much-loved pharmacy brand with a strong heritage.”
The deal is expected to deliver $1bn in cost-savings over the next four years. But Alliance Boots said there were no plans for job cuts.
KKR bought Alliance Boots in 2007 for £11.1bn. The latest deal is expected to be completed by 1 September.