In a transformative moment for the nearly century-old Walgreens, the retailer has officially transitioned to private ownership following a $10 billion acquisition by private equity firm Sycamore Partners. The landmark deal, finalized on August 28, 2025, marks the end of Walgreens' era as a publicly traded company and sets the stage for a significant restructuring into five standalone businesses.

Walgreens Divided into Five Independent Companies

Under Sycamore Partners' leadership, Walgreens will now operate as five distinct entities. These include its healthcare subsidiaries - Shields Health Solutions, CareCentrix, and VillageMD - as well as the international retail pharmacy chain Boots Group. This move aims to streamline operations and focus on core service areas.

"Today represents an exciting new chapter and a turning point for Walgreens", said newly appointed Walgreens CEO Mike Motz in a statement. "As a private organization, alongside our dedicated team members, we are renewing our focus on our core pharmacy and retail platform, our stores, and our customer experience - building on the progress that’s been made."

Leadership Overhaul and Organizational Changes

The acquisition ushers in a wave of leadership changes. Mike Motz, a seasoned retail executive and former CEO of Staples U.S. Retail, has taken the helm as Walgreens CEO, replacing Tim Wentworth. Motz also brings experience as the former president of Canada-based pharmacy chain Shoppers Drug Mart. Wentworth, though stepping down as CEO, will remain with the company as a director. Additionally, John Lederer, a former Walgreens director and senior advisor to Sycamore, has been appointed as the company’s executive chairman.

CareCentrix, Walgreens' home health unit, will retain its current leadership structure, with Steve Horowitz continuing as CEO. As of this writing, no updates have been provided regarding the leadership plans for VillageMD, Walgreens' primary care chain.

Financial Woes and Recent Struggles

The decision to sell follows years of mounting financial pressure for Walgreens, particularly in its core retail pharmacy business. Despite significant investments in healthcare services through ventures like VillageMD, the company struggled to achieve the anticipated returns. Earlier efforts to cut costs and reduce its store footprint also failed to reverse its financial challenges, with Walgreens reporting a net loss of $175 million in the third quarter of this year.

High levels of debt presented additional hurdles ahead of the sale. For the nine-month period ending May 31, Walgreens reported $429 million in short-term debt and nearly $7 billion in long-term debt. These financial difficulties, coupled with plummeting pharmacy margins and declining retail sales, led to credit rating downgrades and an eventual pivot toward private ownership.

Concerns Over Debt-Driven Acquisition

While Sycamore Partners has a history of reviving struggling retail brands such as Belk, Staples, and Lane Bryant, its approach to financing acquisitions has drawn criticism. The Private Equity Stakeholder Project, a watchdog organization, expressed concerns about the Walgreens deal in a report from March. The group highlighted that Sycamore appears to be financing the acquisition "mostly using debt", a move that could leave Walgreens financially vulnerable in the future.

"This leveraged buyout tactic saddles private equity-owned companies with substantial debt, often draining resources that could otherwise be invested in innovation, workforce development, or adapting to market changes", the organization stated.

A New Era for Walgreens

Despite these reservations, Sycamore Partners sees potential in revitalizing Walgreens as a private company. Motz’s experience in retail and pharmacy positions him to lead the company through what promises to be a challenging yet pivotal period. With its operations now split into five independent units, Walgreens begins a new chapter aiming to refocus on its core strengths while addressing long-standing financial weaknesses.

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