Pharmacy is more than just a store. They are an important connection between people and health care.
One of us, Patrick, witnessed in 2003 as a pharmacy technician at Walgreens in West Texas Town in 2003. 매일 수백 개의 처방전이 시스템을 통과하면서 수백 건의 처방전을 처리하는 것이 포함되었습니다. He counted the medicine three severely, deciphered his doctor’s handwriting, and classified a confusing insurance problem. Experiences have shown that the method of owning and managed by a pharmacy is as much as a financial health problem as much as financial problems.
To this day, it is one of the world’s largest pharmacy chains. In 2024, almost 800 million US prescriptions were filled. -In the turning point. Company in March He announced that he would acquire it Sycamore partner, a private equity fund company, is only $ 10 billion in beautification and 10%of the highest market value. The transaction is the first pharmacy chain in the public market. .
And businessAnd we think that this deal provides a window for the future of pharmacy nursing. It is important not only for pharmacists but also for tens of millions of Americans who rely on outlets such as Walgreens and meet everyday health demands.
Walgreens’ rise and struggle
Since 1901, when Charles R. Walgreen SR. purchased the Chicago Pharmacy, there have been many changes in the pharmacy industry, which has worked as a pharmacist. The company was released in 1927. Extended quickly It has grown to 8,000 stores by 2013 throughout the 20th century. Until 2014 Merge with European Pharmacy Chain Alliance Boots WALGREENS has been made into one of the largest pharmacy chains in the world.
More recently, however, the picture for the pharmacy industry hasn’t been so rosy. personnel expenses Rising. Front-End Retail Sales-Things Like Snacks, GREETING CARDS and COSMETICS- . The financial pressure of the pharmacy beneficiary, which is a third -party group that manages the cost of prescription drugs on behalf of the insurance company, has increased.
All of these have led the store to the shutter by greatly limiting profits throughout the industry. Some estimates suggest a lot One -third of the US Retail Pharmacy
In that background, the acquisition of the march of Sycamore Partners’ march argument raises great questions. What Does Sycamore See in this Investment, and what might the strategies Imply the Future of American Pharmacy Care?
Private equity betting frame
Private funds generally want to buy the company, simplify the operation, and sell it for profit within 5 to 7 years after the acquisition.
The global economic movement of these growing private equity funds is never limited to health care. Private fund company was hired in 2020 11.7 million US workers또는 국가 전체 인력의 약 7%. The total assets managed by such investors 11% annually over the last 20 yearsTrend It is expected to continue.
If you look at Walgreens, Sycamore, like these many businesses, has the opportunity to improve low purchases, cost savings and profitability, just like a low business. One survey of private equity investors has found that the most commonly reported value creation source for Sycamore’s size companies is to change products, induce demand, and to change the incentives of people in business. .
Private owners can be patient than the public market, but critics argue that private equity companies tend to focus in the short term, for example, they are looking for prompt and predictable services of margin improvement, such as reducing jobs.
There’s some evidence in Favor of that claim. I found in one study Employment often drops For several years after the purchase of private equity funds. And long -term projects, such as investments in future innovation, can be deprived if the focus is on debt repayment or preparation for resale.
The history of privatized public companies offers a mix of success and failure. Dell Technologies Hilton There are two noticeable examples of private and successfully reconstructed companies. Returned stronger. In such cases, it helped management to concentrate without continuous pressure on the quarterly income report.
On the other hand, the following company Toy R USIn 2005, he was taken private and applied for bankruptcy in 2018, showing whether the debt could lead to a collapse, which could lead to a collapse.
If part of the profit is led to “low purchase” -Sycamore, the easiest indicator of potential future success that can be measured to this day -Sycamore began well. The purchase price indicates a simple thing. 8% premium for market trading value on the day of announcement 46% throughout the industry by 2023. In other words, 83.4%of the purchase supported funds with debt. Advanced for this kind of transaction. Health care group Take the back seat for the debt obligations.
Sycamore as the dust settles when purchasing I showed interest Walgreens were divided into three business units, one focused on the US pharmacy, one to the British pharmacy and one of the VillagemD subsidiaries.
It is not rare: Sycamore used a similar approach before investing. Office supplier retailer staple Long -term sustainability.
given VillageMD was faced after being acquired by Walgreens, which shows the opportunity to evaluate and optimize performance separately. Meanwhile, Sycamore’s historical focus on Sycamore’s sleeves and customer -centered business can help modernize the store’s experience or optimize employees.
For more than a century, Walgreens have survived and have been adjusted to suit the change of sleeves. It is now entering a new chapter. One can reorganize the role of pharmacies in American life as well as its future.
Will Sycamore Help Walgreens Thrive, Using Its Resources to Strengthen Services and Deliver More Value to Customers? Or is the pressure to create a fast return? Either way, the answer is important for anyone who relies on an investor as well as a neighboring pharmacy.
