Billionaire Weston Family Nears Deal to Buy Boots, Dashing IPO Hopes

Canada's billionaire Weston family is reportedly close to acquiring the British chemist Boots for around £6.8 billion, abandoning plans for an initial public offering (IPO) in what is seen as a blow to the City of London.

Sycamore Partners, the private equity firm that purchased Boots' former parent company, Walgreens Boots Alliance, last year, is said to be in negotiations with the Westons, who previously owned Selfridges. A deal could be finalized as early as next week.

The potential acquisition dashes hopes for Boots' return to the UK stock market after a 19-year absence, an event that was anticipated to provide a much-needed boost of confidence for London's financial sector. Earlier this year, Australian pharmacy group Sigma Healthcare had explored preliminary discussions with Boots but ultimately withdrew, briefly rekindling prospects for a float.

"This would be a major blow to the London Stock Exchange which has desperately been trying to attract more companies to float in London," said Dan Coatsworth, head of markets at AJ Bell. "Boots is a major name on the high street and exactly the type of brand that could attract retail investors keen to put money into a name they know well."

Coatsworth added that the Weston family would likely aim to improve the chemist's efficiency and potentially invest heavily in store upgrades.

The Weston family is well-known in the UK through the Associated British Foods conglomerate, which includes the fashion chain Primark and the department store Fortnum & Mason. The Canadian branch of the family, operating under Wittington Investments, controls grocery chain Loblaws and pharmacy chain Shoppers Drug Mart, and sold Selfridges in 2022.

Sycamore Partners acquired Walgreens Boots Alliance for £7.4 billion last year, subsequently divesting certain assets to create the standalone Boots Group, comprising the UK and Irish chemist chains, Boots Opticians, and the No7 Beauty Company. Walgreens Boots Alliance co-founder Stefano Pessina and his wife Ornella Barra retain a 44% stake in Boots.

Pessina had previously indicated that Sycamore would eventually need to sell its stake in Boots.

Boots, which employs 51,000 people in Britain, has seen renewed interest from investors and potential buyers, partly due to strong sales in its beauty products and weight-loss treatments. In the last fiscal year, the company reported a 3.2% increase in annual sales, reaching £7.5 billion. The business traces its origins back to a family herbal medicine shop established in Nottingham in 1849.