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Walgreens agrees to reduce its stake in China joint venture

Walgreens Boots Alliance Inc. said Dec. 22 that it has agreed to reduce its stake in Guangzhou Pharmaceuticals Corp., a wholesale pharmaceutical joint venture in China, to 20%.

Walgreens' venture partner in Guangzhou Pharmaceuticals, Guangzhou Baiyunshan Pharmaceutical Holdings Co. Ltd has offered to buy a 30% interest in the joint venture. The sale is subject to regulatory review and approval, Walgreens said. It did not disclose financial terms of the transaction.

After the proposed sale, the Guangzhou holding company would own 80% of Guangzhou Pharmaceuticals. Walgreens will continue to account for its remaining stake "as an equity method investment."

Alliance Boots, which completed its merger with Walgreens in 2014, formed a 50/50 venture with Guangzhou Pharmaceutical Company Ltd. in 2008.

Earlier in December, Walgreens announced another move in China. The company said it had agreed to buy 40% of a Chinese pharmacy chain, Sinopharm Holding Guoda Drugstores Co. Ltd., for 2.77 billion Chinese yuan, which as of Dec. 4 was about $416 million. That deal is also subject to regulatory and other approvals.