(Photo: Ken Wolter/Shutterstock)

VillageMD, the primary-care provider controlled by Walgreens Boots Alliance Inc., has agreed to acquire Summit Health-CityMD in an $8.9 billion deal that shows the drugstore operator expand deeper into health-care services to reduce its reliance on retail.

Walgreens, which has a 63% stake in VillageMD, said it will invest $3.5 billion of debt and equity to support the combination and will remain the biggest shareholder in the combined company with a 53% stake after the deal closes, according to a statement. Evernorth, a subsidiary of Cigna Corp., is also investing and will have a minority stake in the combined entity. The announcement confirms a Bloomberg News report last month that VillageMD was exploring a combination with Summit Health-CityMD.

 

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