Boots IPO: what to know and how to buy shares

When could the Boots IPO take place?

In December 2023, Bloomberg reported that Boots owner, US-based Walgreens, was considering launching an Initial Public Offering (IPO) for its UK-based subsidiary at a value of circa £7 billion. In June 2024, Bloomberg then reported that IPO plans had been put on the backburner in favour of a potential sale to private equity.

For context, Walgreens has wavered between an outright sale and an IPO for several years, though an IPO may be the more likely outcome due to the difficulty associated with finding a single buyer capable and willing to pay the asking price.

In July 2024, CEO Sebastian James announced he would be leaving Boots in November after six years of service in which he turned the company around. The new appointment of his replacement, Anthony Hemmerdinger, a former senior director of Asda and publicly-listed Sainsbury's, could be the right time to launch.

How to buy Boots shares if the company lists

If Boots do end up listing in the UK, you can buy their shares from £3 commission with us. That's the rate if you've traded 3+ times in the previous calendar month, otherwise our standard fee is £8.

You'll be able to invest in Boots right away on the day of the listing.

1. Do your research on IPOs
2. Open a share dealing account
3. Search for Boots on our share dealing platform
4. Choose the number of shares or amount of money you wish to invest
5. Place your deal

When dealing shares, you own the stock and become a shareholder in the company. You'll profit if the share price rises above the point at which you bought, or potentially from any dividends paid. You could get back less than you put in.

You can also trade the Boots IPO using leverage through a variety of products with us. This means you could gain or lose money quickly and could end up losing more than your initial deposit. This is higher risk and requires thorough risk management.

Read more about IPOs:

• Upcoming IPOs to watch
• How to trade or invest in IPOs
• Trading IPOs on our platform

What will Boots be valued at and what will the share price be?

In the most recent publicly available accounts, Boots generated a post-tax profit of £47 million in the 12 months to 31 August 2023 — up from just £15 million in the previous fiscal year. Meanwhile, total revenue rose by 8.3% year-over-year to £7.05 billion, while operating profit soared by 60% to£88 million.

In recent Q4 results, Boots saw comparable Q4 retail sales increase of 6.2% year-over-year, with sales for the full year to 31 August up by 6.9% year-over-year. Digital sales were hailed as ‘particularly strong,’ being up 18.7% and now make up 15% of total retail sales. The outgoing CEO did note that this represented ‘a 14th consecutive quarter of market share growth and are seeing positive momentum across the whole business.’

This implies that Boots is possibly worth a little more than the £7 billion valuation being quoted by Bloomberg in December 2023. You might expect that Boots will sport a share price upon listing aligned with other large UK retailers on the FTSE 100.

What is Boots’s business model?

Founded in 1849, Boots is a UK-based health and beauty retailer which has a strong foothold in the country’s retail space. It operates one of the largest pharmacy chains in the UK, offering everything from health consultations to prescriptions, vaccinations and mental health services. Boots partners with the NHS to deliver many of its services and is in many ways crucial to the nation’s healthcare, especially where it is the sole pharmacy provider in the region.

The company is also a market leader in many retail products, including beauty, skincare, personal care, baby care and over-the-counter medications. Its ‘Advantage’ loyalty card program is perhaps one of the most popular loyalty schemes in the UK with some 16.7 million members, and it also enjoys exclusive private labels that give it an edge over rivals, such as the No7 beauty range.

Scripts and services account for roughly a third of overall revenues, with the lion’s share derived from retail sales.

Boots also enjoys a well-developed omni-channel strategy that seamlessly combines physical shops with a strong online presence — but has recently closed hundreds of shops to streamline the business, leaving it with 1,900 across the UK. For perspective, the Boots App now has 7.5 million active users with sales at their highest ever level, contributing 40% of total digital sales.

And as part of the Walgreen Boots Alliance, it benefits from access to global supply chains, shared expertise, and economies of scale. For perspective, including equity method investments, the WBA has a presence in more than 25 countries, employs more than 450,000 people and has more than 21,000 stores.

Another significant partnership is the relationship with franchise operator MH Alaysha in the Middle East which operates 90 Boots stores across its markets and may be key to a wider international expansion.

Why are there Boots ethical concerns?

Ethical Consumer has given Boots its worst score for supply chain management and animal welfare, arguing that the business has a weak policy for its workers, stating that it opposes child labour and exploitation, and seeks to uphold freedom of association; but making no commitment to ensuring such practices in its supply chain.

Meanwhile, the outfit argues that while the Walgreen Boots Alliance does not conduct tests on animals itself, several suppliers and brands products from multiple other companies in its shops do test on animals.

It's worth noting that similar accusations have been levied at many of the company’s rivals, and the company has taken steps to address concerns.

There have also been historical allegations from Boots pharmacists that the company has pressured them to sacrifice professional ethics for business targets, and that Boots managers directed pharmacists to give medicine-use reviews to customers who didn't need them.

In addition, Boots has come under fire for political lobbying, tax avoidance and excessive management remuneration.

Boots-related investments

While you wait for the Boots IPO, there are several publicly listed alternatives to consider. A UK investor might leap to competitor Superdrug, which is held by AS Watson, itself majority owned by Hong Kong-based CK Hutchison. THG Group may also be a viable alternative, as it owns various nutrition and beauty brands and websites. You might also wish to consider Boots owner Walgreens.

For those seeking diversification, the Global X Telemedicine & Digital Health UCITS ETF (BFIT) provides exposure to public companies in developed markets that offer access to digital health solutions.

Boots IPO summed up

• Boots is a UK-based health and beauty retailer which has a strong foothold in the country’s retail space. It operates one of the largest pharmacy chains in the UK
• The company is also a market leader in many retail products, including beauty, skincare, personal care, baby care and over-the-counter medications
• Its ‘Advantage’ loyalty card program is perhaps one of the most popular loyalty schemes in the UK with some 16.7 million members
• In December 2023, Bloomberg reported that Boots owner, US-based Walgreens, was considering launching an Initial Public Offering for its UK-based subsidiary at a value of circa £7 billion
• And as part of the Walgreen Boots Alliance, it benefits from access to global supply chains, shared expertise, and economies of scale