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Walgreens agrees to buy 40% of Chinese pharmacy chain

Walgreens Boots Alliance Inc. on Dec. 6 said it has reached an agreement to buy 40% of Sinopharm Holding Guoda Drugstores Co. Ltd. (GuoDa), a subsidiary of China National Accord Medicines Corp. Ltd.

Walgreens said its bid met all the requirements set by the seller following a public tender process. The Illinois-based drugstore retailer said it will buy its stake in GuoDa through a capital increase worth 2.77 billion Chinese yuan (about $416 million).

Shanghai-based GuoDa operates more than 3,500 retail pharmacies across China and is one of the country's leading retail pharmacy chains, according to the Walgreens release. Walgreens said the Chinese chain has been expanding as China enacts healthcare reforms and the importance of the pharmacy channel grows. The American company said it wants to help GuoDa grow further.

Walgreens has had a presence in China for some 10 years, initially through its Alliance Boots division, Walgreens Executive Vice Chairman and CEO Stefano Pessina said.

The deal is subject to regulatory review and approval.

As of Dec. 5, US$1 was equivalent to 6.62 Chinese yuan.