AmerisourceBergen, the pharmaceuticals distribution giant, has entered into a ten year distribution agreement with Walgreen Co and its associate Alliance Boots GmbH. Included in the terms of the agreement is the grant of right to acquire up to 23% shareholdings in AmerisourceBergen.
The deal, according to AmerisourceBergen is expected to infuse US$28 billion in revenue as well as an additional US$0.20 per share in earnings for 2014. The deal is to be effective come September 1 and would include the distribution of branded, generic and specialty drugs for Walgreen's retail outlets, mail order and other specialized pharmacies. With the partnership of Alliance Boots, AmerisourceBergen can even reach further areas throughout the globe.
In a statement, AmerisourceBergen said, "The new agreements are expected to be meaningfully accretive to AmerisourceBergen's earnings and strengthen its confidence in delivering solid and sustainable long-term EPS growth."
With the deal, incremental brand revenue is expected to increase to US$2 billion in September.
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