Walgreens-controlled VillageMD reportedly in talks to merge with Summit Health
VillageMD, which is majority owned by Walgreens Boots Alliance, is reportedly in talks about a deal to merge with Warburg Pincus-backed Summit Health, a healthcare network that is the parent of CityMD, according to a Bloomberg report, which cited people familiar with the matter.
The merger would value the combined entity at between $5 billion to $10 billion, according to the report, which also noted an agreement could be reached in the coming weeks, but which also said that the talks could cease.
Spokespersons at Warburg Pincus and Walgreens told Drug Store News that their respective companies are declining to comment.
[Read More: WBA closes fiscal 2021 with strong Q4, full-year growth]
In October 2021, WBA said it was investing $5.2 billion in VillageMD, increasing its ownership stake in the company from 30% to 63%. Walgreens said the investment will accelerate the opening at least 600 Village Medical primary care clinics at Walgreens locations in more than 30 U.S. markets by 2025, with a goal of 1,000 by 2027. More than half of the practices are in medically underserved communities.
Summit Health was formed by the 2019 merger between Summit Medical Group, one of the nation's premier independent physician-governed multispecialty medical groups, and CityMD, the leading urgent care provider in the New York metro area, Summit Health's website said. "Summit Health delivers a more intuitive, comprehensive and responsive care experience for every stage of life and health condition through high-quality primary, specialty and urgent care," the company states.
[Read more: Walgreens making major investment in VillageMD
Summit Health has more than 2,800 providers, 13,000 employees and more than 370 locations in New Jersey, New York, Connecticut, Pennsylvania and Central Oregon, according to the website.
Warburg Pincus, a New York-based private equity firm, acquired CityMD in 2017 and took a majority stake in Summit after the 2019 merger, according to a statement at the time, the Bloomberg report said.