Boots and Alliance UniChem are expected to finalise the creation of a £7 billion pharmacy giant today as fears grew that a deal could result in job losses.
Details of the merger of the two FTSE 100 firms are expected to be announced this morning and could include a £1 billion cash sweetener to Boots shareholders.
The new company - to be called Alliance Boots - will control 15 per cent of the UK pharmacy market and have nearly 2,500 chemists around the country and in Europe.
But the 'merger of equals' may lead to cuts in the combined workforce of more than 100,000 if roles are duplicated in drug wholesaling, administration and high street stores.
Reports said there are about 350 Boots stores in the vicinity of Moss and Alliance outlets owned by Alliance UniChem.
This could arouse the attention of competition authorities who may also wish to investigate the enlarged company's share of the drug wholesaling market, which will possibly be as high as 40 per cent.
A spokesman for Boots declined to comment on reports of the merger, which come less than a week after the retailer issued a thinly veiled profits warning and declined to reiterate its sales forecast for the year.
Executives of Boots and Alliance UniChem are thought to be keen on a deal because it will give them more muscle when negotiating contracts with suppliers.
This would give them more freedom to cut prices and head off the challenge of supermarkets which are intent on capturing a greater share of the retail market for medicines.
