Abigail Townsend: The Boots brand must now live up to its name

After years of crazy schemes, this merger makes sense for the retailer

It's been some journey since herbalist Jesse Boot first struck upon the idea of opening a shop in Nottingham 157 years ago. From next week, Boots as we know it will be no longer; as its £7bn merger with Alliance UniChem completes tomorrow, a new company, Alliance Boots, takes its place. It will be bigger, more international and have new businesses, including generic drug distribution.

But in its time, Boots has tried so many different tacks, it ought to feel right at home. Before 1989, it was one of those dull companies that didn't do much. Then it decided to transform itself by buying the retail group Ward White for £900m. It spent the next 15 years selling it off.

Over the years, Boots has tried flogging just about everything: bird seed, paintings, insurance, to name but a few. It has expanded into healthcare, dentistry and reflexology. Everything was just one big mess by the time chief executive Richard Baker, who keeps the same role at the new company, took over. All credit to him: there were no sacred cows and nearly everything set up by the previous management was closed. He even flogged the once-untouchable BHI, owner of Nurofen.

But competition, especially from the supermarkets, was never going to be so easily dealt with. And even Mr Baker had a few bad habits. Come Christmas, the gift sets and margin-undermining special offers would creep back - and usually stay there, unsold, until well into January.

But the one thing Boots has always had in its favour is its brand. No matter how crackers the things it sold, nor how dire the offering, it was still a name people identified with. If Superdrug was the flashy younger sister, Boots was the respected aunt.

And this is what Alliance UniChem has seen. It wants to trade on that brand, expanding Boots overseas and selling own-brand products such as Soltan and No 7 far and wide. It's a great idea but one that no chief executive could pursue on his own while all his time was taken up waging war against the price-busting competition.

Mr Baker also understood the value of the Boots brand, backing marketing campaigns that played on its trustworthiness and pharmaceutical knowledge - something no supermarket could do. And on one level it has worked: its latest TV campaign, gently taking the mick out of the English weather, still somehow manages to hold together in the middle of a heatwave.

It has also been waging an all-out PR offensive in the City. For the Square Mile was not con- vinced about this deal. Where were the synergies? Why were two companies in different sectors merging? (Boots is a retailer, Alliance UniChem a healthcare company.) But most of all, it somehow just smacked of yet another of Boots' crazy schemes.

This one, however, should work. The PR campaign has appealed both to consumers - we should see a rise in sales at the Boots business this week - and investors. Of course, in hindsight, this was the easy part. Alliance Boots has to do more than just revel in the brand: finally, it must start delivering on it.

Carruthers had to go

So was BetonSports right to sack David Carruthers, its chief executive, currently languishing in a US jail after the company was accused of contravening the Wire Act? Where is the support during this tough time?

Of course it was right to cut the ties to Mr Carruthers. He may well be proved innocent but, right now, BetonSports cannot guarantee that.

Last week the Department of Justice got an extension on its temporary restraining order against BetonSports' websites, most of which are currently shut down. If sacking Mr Carruthers will help, in any small way, to smooth the wheels in its dealings with the US authorities, so be it. This is, after all, the shareholders' company, not Mr Carruthers'. No chief can ever be bigger than the firm they run.

a.townsend@independent.co.uk