Boots buys US$400m stake from Sinopharm
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Pharmacy and healthcare company Walgreens Boots Alliance has paid RMB2.76 billion (US$417 million) for a 40 per cent stake in a drugstore chain owned by Sinopharm Group.
Sinopharm is China’s largest retailer of pharmaceutical and healthcare products and Walgreen will take a stake in its Sinopharm Holding Guoda Drugstores subsidiary. The transaction is subject to review and approval from regulatory authorities in China.
“We have had a presence in China for around 10 years, initially through Alliance Boots, and are excited with the opportunity to further invest in the country’s fast-growing retail pharmacy sector,” says Walgreens chief executive Stefano Pessina.
Sinopharm says Walgreens Boots Alliance’s pharmacy expertise and international retail experience will help Guoda improve efficiencies and transform its business model to differentiate from domestic competitors. The partners will also explore opportunities in the broader Asian and global markets, in keeping with Beijing’s Belt and Road Initiative.
China, the world’s second-largest pharmaceutical market, has made moves to speed up approvals of medicines and medical devices.
Questions & Answers
Q.What is the primary purpose of Walgreens Boots Alliance’s investment in Sinopharm?
What is the primary purpose of Walgreens Boots Alliance’s investment in Sinopharm?
Walgreens Boots Alliance aims to further invest in China’s rapidly expanding retail pharmacy sector. The company views this as an opportunity to deepen its presence in a fast-growing market, building on its decade of operation there.
Q.How will Sinopharm benefit from this new partnership with Walgreens Boots Alliance?
How will Sinopharm benefit from this new partnership with Walgreens Boots Alliance?
Sinopharm expects to gain from Walgreens Boots Alliance’s expertise in pharmacy and international retail. This collaboration should help Guoda improve its efficiencies and transform its business model, allowing it to stand out from other domestic competitors.
Q.What wider opportunities will the partners explore beyond the Chinese market?
What wider opportunities will the partners explore beyond the Chinese market?
The partners plan to explore broader opportunities in the Asian and global markets. This exploration aligns with Beijing's Belt and Road Initiative, indicating a strategy for international expansion and collaboration beyond China.
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