Walgreens and two former top executives are settling charges that they misled investors about the profit potential of its pending $16 billion merger with the European retail chain Alliance Boots.
In an agreement with the Securities and Exchange Commission, Walgreens Boots Alliance Inc. agreed to pay a $34.5 million penalty. Former CEO Gregory Wasson and Wade Miquelon, former chief financial officer, will each pay $160,000, without acknowledging wrongdoing.
According to the settlement announced Friday, Walgreens in 2012 projected a combined, adjusted profit of $9 billion to $9.5 billion for 2016.
Though internal forecasts later revealed significant risks of not hitting that goal, the executives stuck the original forecasts.
Finally, in August 2014, the company issued a 2016 forecast that was 20 percent lower.
Shares tumbled 14 percent in one day.