Sebastian James is resigning as CEO of Boots as the US owners call off the sale of the company for the second time in two years.
James, 58, will leave in November to take on another role in the healthcare sector, Sky News reported.
James, a former member of Oxford University’s infamous Bullingdon Club alongside Boris Johnson and David Cameron, joined Boots in 2018 through electronics retailer Currys, then known as Dixons Carphone.
Sebastian James’ plans for Boots derailed by the pandemic
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In recent years, Walgreens had explored the prospect of selling Boots or listing it on the London Stock Exchange, but the plan was dropped. A source close to James — a charismatic figure who is comfortable in the spotlight — said he would like to get involved Boots as a listed company. With the prospect of being taken off the table, he decided to accept an offer from another company.
Before joining Boots, James had worked with Dixons since 2008, navigating the ultimately disastrous merger with Carphone Warehouse.
His plans for Boots were derailed by the pandemic, which took a heavy toll on a company that relies heavily on its stores in city centers and travel hubs. Boots was heavily criticized by landlords at the time for withholding rent and service charges.
Walgreens, the American pharmaceutical giant that has owned Boots since 2014, sent its chief operating officer Ornella Barra, the partner of Walgreens chairman Stefano Pessina, to the United Kingdom to get Boots in order.
Yet James leaves after overseeing a strong recovery. Last week, Boots reported like-for-like sales growth of 6 percent in the third quarter, driven by strong online sales. Pre-tax profits rose 42 percent to £237.6 million last year. Revenue rose £600 million to £8.3 billion.
Under James’ leadership, Boots has focused heavily on its more profitable beauty business. The chain opened its first “beauty only” store in Battersea Power Station, London, last year, with more stores reportedly in the pipeline.
Richard Hyman, a retail analyst, believes these stores mask deeper problems within Boots’ estate, which has been underinvested in.
“Walgreens let Seb James develop some very glitzy stores that they could direct potential investors to – but the rest of the company suffered. It has been difficult for him to leave a legacy because his hands are tied to some extent. He was kind of hiding for nothing.”
Boots has closed around 300 outlets in total since James arrived. The pharmacy business continues to struggle, largely due to central government cuts.
Walgreens had sent its chief operating officer to the UK to whip Boots into shape
STEPHANIE KEITH/BLOOMBERG VIA GETTY IMAGES
James has long wanted Boots to become more of a GP support service, a move that would ease pressure on the NHS and drive more people into the shops.
Although Boots has started offering flu shots and consultations for smokers wanting to quit, convincing the health service to transfer more basic consultation services to Boots has proven more difficult than James had hoped.
The second half of James’ tenure at Boots has been clouded by uncertainty over the chain’s future ownership. Walgreens first put the chain up for sale in 2021, as its domestic business struggled.
However, buyers were unwilling to match the £7 billion-plus price tag. The chain’s US parent company this year resumed talks with private equity bidders, including Asda owner TDR Capital, which is still keen to buy Boots, before deciding to retain the business again.
“While we believe there is significant interest in this business at the right time, Boots’ growth, strategic strength and cash flow remain important contributors to Walgreens,” a Walgreens spokesperson said. “We are committed to continuing to invest in Boots and finding innovative ways for this business to realize its potential.” City sources believe a sale of Boots is inevitable at some point.