Jan 12, 2022
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Bain and CVC to link up on Boots bid - report

Jan 12, 2022

Recent news that the Boots chain could be up for sale has been followed by reports that two of the world’s biggest private equity names are teaming up on a multibillion pound bid for the giant UK health & beauty retailer. Bain Capital and CVC Capital have thrown their hats into the ring, reports claim.


The Boots business, which is owned by US-based Walgreen Boots Alliance (WBA), has seen a recovery in recent periods and remains the biggest name in UK beauty retail. As well as being a key player in beauty sales from the mass-market to the prestige sector, it also holds the local licence for Mothercare, is a big retailer of branded eyewear, own the No 7 beauty company, and has a key role in delivering UK healthcare services. That latter fact means that any deal would be closely scrutinised by the UK government.

Sky News said US-based Bain and British operation CVC (which used to own Debenhams and still owns Breitling) are joining forces and are currently working on a combined bid. While Boots has a huge UK store chain comprising around 2,000 locations, they’re believed to be especially interested in further exploiting the firm’s online potential.

But other major private equity names are also likely to make a play for the firm. They could include Apollo Global Management and Fortress Investment Group. Both of them have been looking for strong UK opportunities of late but missed out on Morrisons last year. Apollo also tried to buy Asda in 2020.

An auction process is likely to begin this summer. But it’s not out of the question that rather than selling to private equity, WBA — which is a stock exchange-listed business — could choose to go down the route of a separate stock market listing for Boots.

WBA has confirmed that a strategic review has begun and that Boots is its primary subject as the parent firm focuses more heavily on the North American market.

With CVC said to be interested in a buy, it’s particularly interesting that CVC managing partner Dominic Murphy sits on the WBA board and was a key person in the process that saw Boots being taken private by Italian billionaire Stefano Pessina 15 years ago. He was also heavily involved in the later merger that created WBA. Boots under CVC partial ownership could see him taking a major role post-acquisition, although given the conflict of interest, he would have to remove himself from any WBA board discussions around the sale.

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