Stefano Pessina is one of those businessmen who sharply divides opinion.
To some, he is a tax-avoiding wheeler dealer who has gambled with one of Britain’s best-loved retailers to vastly increase his wealth. To others, he has invested and created jobs at a company that was all set to become another of the High Street’s casualties when he scooped it up in 2007.
Whichever view you favour, this is a guy who knows his own business. It’s hard to interpret today’s deal as anything other than the paying off of a calculated risk taken at the height of the cheap debt boom. Pessina correctly saw a growing market for healthcare retailing and drug supply when he teamed up with private-equity group KKR. The Italian recently talked up the prospect of expanding into new markets. Little did his followers know he meant by getting someone else to do it for him.
Pessina deserves extra kudos for enticing an American retailer to stake billions on Europe’s economy just as it takes another sickly turn for the worse. But where does it leave Boots, the High Street chain at its heart?
The retailer has successfully battled with supermarkets and pound shops to retain the affection of British shoppers. It’s fair to say that Walgreens will be equally interested in the value in Alliance’s wholesale business, which is one of the biggest suppliers to the NHS.
The chaps in Deerfield, Illinois, probably couldn’t find Nottingham, Boots’ spiritual home, on a map without help.
Could Walgreens’ boss Gregory Wasson, care less about Britain than Irene Rosenfeld, Cadbury’s conqueror at Kraft? It would be hard. At least this deal will give City bankers, who have been grumbling about a lack of work this year, a rosy glow.
