Another British brand is sold

  interzone55 17:15 19 Jun 12
Locked

Today US-based pharmacy chain Walgreens bought a 45% stake in Boots, with an option to buy the rest.

http://www.bbc.co.uk/news/business-18504340

  Forum Editor 18:45 19 Jun 12

"The two companies have very little overlap. As a result, no job losses are expected from the deal. In fact, the BBC's business editor Robert Peston says the deal could create a world manufacturing centre in Nottingham, potentially increasing the number of jobs."

Sounds like a good deal to me. We're living in an age of global marketing - whether a company is originally British or not makes little difference in that context. What matters is where the money goes, and in this case it sounds as if a good deal of it will come into our economy.

  interzone55 19:43 19 Jun 12

I seem to remember similar being said about Cadburys.

  morddwyd 19:51 19 Jun 12

I seem to recall that Boots is co-owned by private equity company KKR, hardly a British company, and a Mr Stefano Pessina, an Italian gentleman!

  interzone55 22:11 19 Jun 12

morddwyd

I've had a look into this and I don't fully understand it.

Boots merged with Alliance Unichem in 2006

Then in 2007 Stefano Pessina, who built Alliance Unichem, bought Alliance Boots using money from KKR.

Alliance Boots is now (up to the US part purchase) wholly owned by AB Acquisitions Holdings Limited, a British registered company, who are in turn owned by KKR.

All very murky

  spuds 01:42 20 Jun 12

How many times have we heard the story about helping the economy, job security etc when a UK based and previously owned company is being taken over by foreign enterprise?.

In my neck of the woods, there were many well known companies that produced hosiery,footwear,engineering who merged, or were taken over by foreign or equity companies (possibly based abroad for tax incentives), and it did very little for the people or the economy, because those previous well known companies no longer exist in name or the UK. I could perhaps also add, that a number of these companies were taken over via special funding grants (for job security) that the government provided.

Fisons have just closed a large work site, which employed many hundreds of specialist technicians. The same applied to English Electric and quite a number of others. The work sites are now housing projects or due to become one. I suppose we could all work from a house or home?.

A couple of miles from where I live, a well known food company was bought out last year, with the promise of expansion and job security. Some people decided to take redundancy, others decided to stay on and help with the new owners ideas. Last week it was announced that redundancies would take place, and the new owners are only going to pay the minimum amount of redundancy pay. This in effect will leave those that remained, thousands of pounds out of pocket, compared to those that left earlier. But hey why worry, the bosses got what they wanted in the end, even though promises were made!.

And please don't get me on about the foreign companies that were allowed to take over our utility companies, and who are now holding the country and its people to ransom with ever increasing prices. Which according to our toothless watchdogs, the increase in prices are not necessary, which they are doing very little about redressing the issues being raised.

(Better go bed, before I make this into a real rant. But it does make me very annoyed when we hear about how we are or will benefit from these moves)

  Snec 12:41 20 Jun 12

morddwyd is right, Boots was owned by an Italian company and when it purchased Boots — which had been based in Nottingham for 161 years — it moved its headquarters to Zug in Switzerland.

Before the takeover, Boots had paid £89?million in British tax in its final year as a quoted company on the London stock market. Now that it pays its tax in Zug, that figure has shrunk to just £9?million. No doubt this will be even less now. This happens every time a UK company is sold.

So, no, it's not a good deal because eventually the only people paying tax will be small businesses and the employed. There isn't enough of either to make up the deficit plus pay off the UK's debts let alone secure the future for our kids and their offspring. Working right up to death is just over the horizon. Paying into a pension fund will become something future generations will only read about, that is if they can afford to buy a book because it's doubtful there will be any libraries still open by then.

  namtas 13:15 20 Jun 12

"In fact, the BBC's business editor Robert Peston says the deal could create a world manufacturing centre in Nottingham, potentially increasing the number of jobs."

Note in the comment the significant word could, how many times have we heard that ?

  john bunyan 13:16 20 Jun 12

It is, of course regrettable when foreign companies take over British ones and then either shut parts or avoid tax. However it is probably because other British companies who might have bought the original ones did not think it a good idea to buy the companies that were up for sale. Big UK multinationals are just as acquisitive in buying outside the UK - in particular in China, S America, India and the USA. Perhaps forum member (master of references) will tell us how the inward investment by foreign companies into the UK compares with the outward investment by UK into overseas companies. I have a feeling the balance will show we as UK have more investment abroad than foreign investment here, so any attempt to stop it would be counter - productive. As for Zug, I suspect that profits arising in UK are taxed here, but some international profits are declared where the company is based (Switzerland in this case)

  john bunyan 15:35 20 Jun 12

Forum member

Don't let it go to your head - I will try to have an argument if you prefer! One of the links seems to show what I thought - UK outward investment exceeds inward. See investment

  Forum Editor 19:34 20 Jun 12

Alan14

"All very murky"

All very common, and yes, sometimes all very convoluted, but murky? That's not really fair. Nothing murky about it.

This thread is now locked and can not be replied to.

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