The withdrawal of Australian pharmacy giant Sigma from its £7bn bid for Boots has reignited hopes that the high street pharmacy chain could pursue a London Stock Exchange listing. This development is particularly significant given the bleak recent trend in new listings, with only eight companies raising funds on the FTSE this year, compared to 31 in 2021.
The £7.5bn valuation of Boots, following its robust financial performance last year, would make an Initial Public Offering (IPO) a substantial boost for the UK capital markets. In 2022-23, pre-tax profit increased by 25% to £337m on the back of near six per cent growth in retail sales and three per cent overall revenue growth.
Sycamore Partners' acquisition of Walgreens Boots Alliance last year has led to early discussions with both Sigma and the Weston family. The latter, known for their Canadian operations including Loblaws and Shoppers Drug Mart, are now the sole remaining party in negotiations. Their continued interest underscores the perceived value and strategic importance of Boots within the retail and healthcare landscape.
The implications of a private takeover or public listing for UK households cannot be overstated. A change in ownership could bring about shifts in store strategy, product offerings, and pricing, while a public listing would increase transparency and accountability to shareholders. Policymakers will also be watching with interest, as the focus on the London market aligns with efforts to encourage more companies to list in the UK.