Tuesday, June 19, 2012

What does Walgreen's deal mean for Boots at Target?

Today's announcement that Walgreen will pay $6.7 billion in cash and stock to buy a stake in European health and beauty retailer Boots has me wondering whether the beauty brand will continue to be sold at Target.  Walgreen bought a 45% ownership stake in Switzerland-based Alliance Boots, which runs more than 3,300 health and beauty retail stores in 11 countries, in addition to selling beauty products at Target. 

The deal specifies that Walgreen also has an option to buy the rest of the company in about three years time.  Given that fact, I wouldn't be surprised if Boots starts to disappear from Target stores as it's phased into Walgreen's own drugstores.

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