Reliance Industries and Apollo Global Make Binding Offer to Acquire Boots

After months of negotiations, Apollo Global Management and Reliance Industries, owned by Mukesh Ambani, have finally made a firm offer to acquire the British chemist and drusgtore chain Boots.

According to people in the know, Reliance has teamed up with Apollo and made a binding offer for the international pharmacy arm of Walgreens Boots Alliance Inc. of £5-6 billion. A binding bid could help Reliance seal the deal ahead of rival bidders including British billionaire brothers Issa and TDR Capital.

The pharmacy chain is currently owned by US retail giant Walgreens Boots Alliance and has a presence in the UK, Ireland, Italy, Norway, the Netherlands, Thailand and Indonesia. Walgreens had put the business up for sale in December last year and asked for a valuation of around £7billion for Boots.

The bidding process has been ongoing for several months amid multiple geopolitical issues, including rising Covid-19 cases, inflation, the Russian-Ukrainian war and volatility in UK credit markets. United.

Experts say Reliance has bid for the huge retail network of more than 2,200 stores across the UK, as well as private label brands like No7 Beauty Co. and operations in multiple countries.

However, when Activity area emailed Reliance, he said, “As a politician, we do not comment on media speculation and rumors. Our company regularly evaluates various opportunities. He further added that he has made and will continue to make necessary disclosures in accordance with his obligations under SEBI regulations.

Diversification of activities

The company is looking to diversify from its traditional oil to chemical business. It has expanded into several sectors, including retail, telecommunications and digital services, and has seen a flurry of acquisitions over the past year. These include the acquisition of digital market leader, Netmeds, furniture and home decor retailer, Urban Ladder, and lingerie and intimate apparel brand, Zivame, as well as a host of brands of Indian fashion designers.

Arvind Singhal, founder and chairman of Technopak Advisors, sees no immediate impact of the acquisition on Reliance’s business presence in India. He said: “The boots are not present in India so I don’t see a big impact. They may launch in India, however, in my opinion, Reliance may have acquired it from a global presence perspective for its overall retail spectrum.

“Strategic Move”

Satish Meena, an independent analyst covering e-commerce, said this was a very strategic move by Reliance. He believes this potential deal is in line with his e-commerce and retail strategy. “There are four baskets in which Reliance grows; fashion, groceries, digital services and pharma. So this acquisition makes a lot of sense.

Reliance has already acquired more than a dozen brands, including some well-known designer brands. It consolidates its online and offline footprint with Jiomart. Moreover, it is also strengthening its b2b and b2c presence by aligning its logistics and supply chain.

On digital services too, according to its FY21 annual report, Reliance Jio has acquired the right to use spectrum in all 22 circles across India, bringing its total spectrum footprint to 1,732 MHz, registering a significant jump. by 56%. Not only that, he has strategic initiatives with Facebook and Google for digital inclusion in India. He also works with Microsoft to improve the adoption of advanced technologies.

“After investing heavily in fashion and groceries, this (drugstore) is their next category. So Reliance absolutely sees the potential. It’s a new category, and Reliance has the potential to increase the size of the category. added Meena.

Published on

June 09, 2022

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