The move will see the Alliance UniChem brand disappear and the Boots brand extended into new markets. The name of the merged company is to be Alliance Boots.
Alliance UniChem has a network of 400 stores in countries including Norway, Ireland, Thailand, Italy and Switzerland. Some of these could be rebranded to become Boots stores, but this will be looked at on a territory-by-territory basis. Boots has around 100 stores internationally, including 80 in Asia and the rest in Ireland.
The merger comes as Boots struggles to compete against supermarkets, which are encroaching on its territory and able to offer bigger discounts to shoppers. It claimed the deal with Alliance UniChem would address this problem by making it more competitive and delivering £100m in annual cost savings within four years.
It would also give a bigger international market to Boots-branded products such as the No. 7 beauty range and Soltan suncare lotions. The Boots Advantage Card scheme will also be extended across the group.
After the merger, Alliance Boots will form a network of 2,600 outlets in the UK. It plans to run two distinct formats: the community pharmacy, which will account for 1,500 stores; and 800 health and beauty stores, most of which will include a pharmacy. The remaining 300 stores will include Boots Opticians and Scholl footcare outlets.
Richard Baker, chief executive of Boots, said: "Today's announcement will enable Boots to put the Chemist even more firmly at the heart of our strategy. With Alliance UniChem's distribution network and proven international expertise, Alliance Boots will also have exciting opportunities to take the trusted Boots brand and products into new markets."
Today's announcement comes only five months after Alliance UniChem revealed it was to undertake a massive rebranding of its UK stores to the name Alliance Pharmacy.
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