Walgreens Boots makes Pessina permanent CEO; job cuts continue
Deerfield-based Walgreens Boots Alliance Inc. has named Stefano Pessina as CEO, making permanent a role the executive has filled since the largest drugstore chains in the United States and Great Britain combined to create one of the world's biggest pharmaceutical purchasers.
The company also announced on Thursday fiscal third-quarter earnings thsat came in much higher than Wall Street expected, and its stock started climbing well before markets opened.
The 73-year-old Pessina was chairman of European health and beauty retailer Alliance Boots before engineering the combination with Walgreen Co. That deal was completed last year when Walgreen said it would pay about $16 billion in cash and stock to buy the remaining stake in Alliance Boots that it did not already own.
"Pessina's home is in Monaco, but obviously he spends a significant amount of time here in Deerfield. And as the leader of a global organization, his travel schedule is quite busy," said Walgreen spokesman Michael Polzin.
Walgreen initially bought a 45 percent stake in Alliance Boots in 2012. The combination created a company with global reach and leverage that can be used in negotiating prices with drugmakers and other health care providers. Drugstores have also been delving deeper into the administration of care by opening clinics and offering a wider array of health care-related products in their stores.
The combined company had more than 13,200 stores in 11 countries at the end of May and more than 350 distribution centers.
Walgreens Executive Chairman James Skinner said in a statement that the integration of the two companies has gone "exceptionally well," and the board picked Pessina as CEO to continue the momentum.
Pessina had served interim replacement for Walgreen leader Greg Wasson, who retired after the tie-up was completed.
Walgreens also reported on Thursday adjusted fiscal third-quarter earnings of $1.02 per share.
That trumped average analyst expectations of 86 cents per share, according to FactSet.
Walgreens announced in April a plan to close about 200 U.S. stores by fiscal 2017 as part of a push to cut costs. It said Thursday that it has shuttered nine so far and will close an additional 70 to 80 by the end of the fiscal year.
The company also said it was cutting about 700 jobs outside stores in its international retail pharmacy business. Walgreens Boots Alliance employs more than 370,000 people globally.
•Daily Herald Business Writer Anna Marie Kukec contributed to this report.