Walgreens Boots Alliance Inc.’s Chief Executive Officer Rosalind Brewer stepped down suddenly after a brief tenure in which the drugstore chain struggled break into more lucrative parts of health care.
(Bloomberg) — Walgreens Boots Alliance Inc.’s Chief Executive Officer Rosalind Brewer stepped down suddenly after a brief tenure in which the drugstore chain struggled break into more lucrative parts of health care.
Under Brewer’s leadership, added primary care centers to hundreds of US stores and acquired urgent-care provider Summit Health-City MD to draw in customers and move into patient care. But the transition has been rocky, and Walgreens slashed its full-year profit forecast last quarter. The stock has lost half its value since she took over in March 2021.
“It’s not narrative with a lot of ‘wins’ in it,” Bloomberg Intelligence Jonathan Palmer said in an email. The shares fell 2.1% at the New York market open.
Brewer is departing by mutual agreement, according to the statement. The move took effect Aug. 31 and board member Ginger Graham has been appointed as interim CEO, according to a statement Friday. Brewer was one the only Black woman serving as a CEO in the S&P 500.
Hand-picked by Chairman and former CEO Stefano Pessina, Brewer was chosen to transform the drugstore chain into a health-care provider to better compete with CVS Health Corp., which had been aggressively expanding with moves like the 2017 purchase of health insurer Aetna for almost $70 billion. While the pandemic brought some customers back to brick and mortar drugstores, chains have been hurt by competition from online retailers like Amazon.com Inc.
Investor Unease
Brewer came from Starbucks Corp., where she last served as chief operating officer. Pessina said her digital expertise and leadership skills would make up for her lack of experience in health care.
Since her arrival, Walgreens has been pushing more into health-care services and pulling back on its retail presence. Over the past few months, it announced plans to close 450 stores and cut 10% of its workforce. It also tried unsuccessfully to sell its UK chain of Boots drugstores.
The departure leaves a leadership vacuum at the company’s helm after James Kehoe stepped down from his role as chief financial officer last month, moving to the tech sector.
“We do see the interim CEO and CFO positions as potentially creating some investor unease,” Evercore ISI analyst Elizabeth Anderson said in a note. Still, given the company performance “it makes sense to retrench and search for a new leadership team with more extensive backgrounds in healthcare services.”
–With assistance from Jeff Green.
(Updates throughout)
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