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The nation’s largest drugstore chain, Walgreen Co. (NYSE: WAG) this morning announced that it and its European partner Alliance Boots have entered into a 10-year contract with drug distributor AmeriSourceBergen Corp. (NYSE: ABC) that includes the right for Walgreen and Alliance Boots to acquire up to 23% of AmeriSourceBergen. According to AmeriSourceBergen the value of the contract in 2014 period is $28 billion. Cardinal Health Inc. (NYSE: CAH), Walgreen’s former distributor, is the odd-man out when its distribution contract with Walgreen’s ends in August.

The equity ownership part of the deal is perhaps most interesting. Under the terms revealed today, Walgreen may purchase up to 7% of AmeriSourceBergen stock on the open market. Walgreen also received warrants to purchase up to a total of 16% of the distributor’s stock. The open market purchases may begin in May 2016 at a strike price of $51.50, about 6.6% above AmeriSourceBergen’s closing price last night. The second round of purchases, amounting to 16% of AmeriSourceBergen total equity, begins in May 2017 and lasts for six months at a strike price of $52.50.

Once Walgreen accumulates a 5% stake in the company, Walgreen’s will appoint one of its executives to AmeriSourceBergen’s board. Once the full equity position is wrapped up, Alliance Boots will name a second director. The two new directors are additions, not replacements, to AmeriSourceBergen’s board. Walgreen owns 45% of Alliance Boots.

Walgreen’s shares are up about 4.4% in the early afternoon, at $44.30 in a 52-week range of $28.53 to $45.80. AmeriSourceBergen’s shares are up 5.7% at $51.07 in a 52-week range of $35.48 to $52.15.

Cardinal Health is watching its share price dive nearly 7% to $42.96 in a 52-week range of $36.91 to $47.23.