In a deal worth close to $9 billion, Walgreen Boots Alliance Inc., the No. 2 U.S. pharmacy chain, will support primary care provider VillageMD, which will acquire urgent care provider Summit Health.
The independent physician-run medical groups Summit Health manages and CityMD, a service that serves as an alternative to trips to the hospital emergency room, are both supported by the private equity firm Warburg Pincus.
On Monday, Walgreens announced that it would contribute $3.5 billion to the acquisition, which is anticipated to close in the first quarter of 2023, using a balanced mix of debt and equity. With a stake of about 53%, the company will continue to be the largest and most active shareholder in VillageMD.
The healthcare division of health insurance provider Cigna Corp., Evernorth, will also contribute to the deal and become a minority shareholder in VillageMD.
In order to take the deal into account, Walgreens increased its fiscal year 2025 sales goal for the U.S. healthcare industry from $11.0 billion to $12.0 billion to $14.5 billion to $16.0 billion.