Walgreen Company (NYSE:WAG) is set to acquire the U.K. drugstore chain Alliance Boots GmbH after the shareholder vote regarding the deal this on December 29. In an article on Wall Street Journal, Paul Ziobro, explained the uniqueness of this deal in which the largest drugstore chain in U.S. if measured by the number of stores is going to hand out some of its most important posts to the company that it set out to acquire.
Walgreen Company (NYSE:WAG)’s current CEO, Greg Wasson will leave his post to the Stefano Pessina, Executive Chairman of Alliance Boots, as he retires. Although this will be a temporary replacement but Pessina will have considerable influence in selecting the new man for the job, according to the article. Among other positions that will be filled by Alliance Boots staff in the new company, Walgreen Boots Alliance is the key post of president, which will be taken over by Alex Gourley.
These new changes are generally considered to be favourable by the Walgreen Company (NYSE:WAG) shareholders. Ziobro mentioned that according to the Credit Suisse analyst, Edward Kelly, Walgreen’s underperformance during the past few years is major cause for this welcome change.
The unexpected lowering of 2016 forecasts also hurt the Walgreen Company (NYSE:WAG) investors this year when the stock fell sharply responding to the news. The company claimed that it had earlier failed to appropriately account for the rising cost of generic drugs, according to Ziobro.
The vote on Walgreen Boots Alliance has little excitement to offer as the biggest shareholders of the company including advisory firms, Glass, Lewis & Co. and Institutional Shareholder Services Inc. are already in favour of this merger, which will lead to the formation of the world’s largest drugstore chain.
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