Key facts
- Sigma Healthcare has withdrawn from talks to acquire UK retailer Boots.
- The Australian company cited strategic and capital investment objectives as reasons for abandoning the pursuit.
- Boots' owner, Sycamore Partners, had been in early talks with Sigma and the Weston family.
- Sigma's exit leaves the Weston family as the sole remaining bidder for Boots.
- Boots is considering either a sale or a London IPO.
Sigma Healthcare has withdrawn from discussions to acquire the UK retail pharmacy chain Boots, a deal that was reportedly valued at £7.5 billion. The Australian pharmaceutical firm announced on Monday that the acquisition would not align with its strategic and capital investment objectives. Sigma's exit leaves the billionaire Weston family, major shareholders in Associated British Foods, as the sole remaining party in sales talks with Boots' owner, Sycamore Partners. Sycamore Partners had been engaged in early discussions with both Sigma and the Westons. Boots is now weighing up either a sale or a London IPO, which would mark a return to the FTSE 100 for the 177-year-old British retailer. Sigma's share price jumped more than 6% to A$2.80 on Monday, suggesting investors viewed the potential acquisition as a "bullet dodged." Retail analyst Nicholas Found cautioned that Sigma's exit "does not make a Boots IPO straightforward," noting the need to convince investors of its valuation in a competitive market. Boots reported a pre-tax profit of £337m for the year to August, up 25% from the previous year. The company has expanded its beauty and wellness offerings, including its No7 brand. The incoming chief executive, Alex Baldock, is seen as a competent leader capable of presenting the business well to shareholders. The Weston family, through Wittington Investments, also owns grocery chain Loblaws and pharmacy business Shoppers Drug Market in Canada.