Walgreens private equity takeover discussed on Fox 32

PESP executive director Jim Baker warns of risks facing Walgreens after private equity takeover on Fox 32 Chicago

The Private Equity Stakeholder Project’s Executive Director Jim Baker was featured on Fox 32 Chicago to discuss growing concerns around the future of Walgreens following its acquisition by private equity firm Sycamore Partners.

During the segment, Baker explained how private equity ownership can fundamentally shift a company’s business model, even at a scale as large and established as Walgreens, which employs roughly 220,000 workers nationwide and serves millions of customers each year.

“Walgreens is massive. It has about 220,000 U.S. employees. It’s been around for decades and is a Chicago institution,” Baker said. “But size alone does not protect a company once private equity takes control.”

Baker pointed to Sycamore Partners’ ownership of Staples as a cautionary example. Since acquiring the office supply retailer in 2017, Sycamore has closed roughly one-third of Staples’ U.S. stores, resulting in tens of thousands of lost jobs.

“If they closed a similar share of stores at Walgreens, that would be about 70,000 lost jobs,” Baker said. “That would mean thousands of communities losing access to critical health care services and easy access to prescriptions.”

The discussion also highlighted how store closures can quickly create pharmacy deserts, particularly for seniors and people with chronic health conditions who rely on neighborhood pharmacies for routine care.

Baker placed Walgreens’ situation in a broader national context, citing PESP research on private equity’s role in major corporate bankruptcies.

“We found that private equity firms were responsible for 54 percent of large company bankruptcies,” Baker said, referencing household names including Red Lobster, Steward Health System, and Genesis Healthcare.

He explained that these outcomes are often driven by a familiar private equity playbook: heavy debt loads, dividend extraction, and short investment timelines that prioritize quick returns over long-term stability.

“Private equity firms are often not focused on long-term success or survival,” Baker said. “They typically own companies for just a few years and are looking to double or triple their money in that short period of time.”

Baker also flagged Sycamore’s past dividend practices as a specific warning sign for Walgreens.

“Two years after buying Staples, Sycamore took a billion-dollar dividend out of the company,” Baker said. “We’ve seen these tactics before, and that’s part of what has us concerned about what could happen at Walgreens.”

In the interview’s final segment, Baker discussed PESP’s work supporting workers and communities impacted by private equity-driven bankruptcies, including efforts to secure a $20 million hardship fund for Toys “R” Us workers after the retailer collapsed under private equity ownership.

The Fox 32 appearance underscores growing scrutiny of private equity’s role in shaping the future of major employers and essential service providers, particularly when those companies play a central role in community health and access to care.