Shares of AmerisourceBergen Corp. (NYSE: ABC) surged by 11 percent on Tuesday after reports of Walgreens Boots Alliance (NASDAQ: WBA) possible takeover attempt in order to boost profitability for the drugstore giant as the healthcare competition grows, according to the Wall Street Journal, citing sources familiar with the matter.
Chief Executive Stefano Pessina reached out several weeks ago to Amerisource CEO Steven Collis about possibly buying out a portion of Amerisource that Walgreens doesn’t own already, according to sources.
Although, the sources say that the discussions are still in early talks as there is no offer yet and that there may not be a deal at all.
Walgreens already owns a 26 percent stake in Amerisource, including a representative on its board. Walgreens is looking to raise its stake or even possibly buying out the company as a whole.
The healthcare market is rapidly growing competitive with companies looking to make acquisitions and mergers like CVS’s acquisition of Aetna in result of Amazon’s healthcare expansion.
Walgreens is one of the largest drug store operators, while Amerisource is one of the largest drug distributors in the U.S. The buyout will strengthen the two companies’ already existing relationship and create a powerhouse drug operations.
If Walgreens does takeover Amerisource, this would make this its largest acquisition. Amerisource. Amerisource had a market cap of approximately $19.6 billion, which Walgreens owns about $5.1 billion. Walgreens has a market cap of $68.1 billion.