Rite Aid, Walgreens And Fred’s
Rite Aid, Walgreens And Fred’s
Rite Aid, Walgreens And Fred’s a bid to bolster its chances to buy Rite Aid, Walgreens Boots Alliance and Rite Aid said Tuesday that they plan to sell hundreds of Rite Aid locations to Fred’s Inc. for $950 million. In a bid to bolster its chances to buy Rite Aid, Walgreens Boots Alliance and Rite Aid said Tuesday that they plan to sell hundreds of Rite Aid locations to Fred’s Inc. for $950 million.
Walgreens, Rite Aid Find Unlikely Buyer for 865 Stores
Under pressure from antitrust regulators, Walgreens Boots Alliance Inc. and Rite Aid Corp. said Tuesday they agreed to sell 865 stores, moving a step closer to consummating their $9.4 billion merger. Fred’s, which is based in Memphis, Tenn., has secured $1.65 billion in borrowings to fund the all-cash, $950 million purchase of the Rite Aid stores plus ongoing operating costs. It has pledged nearly all its assets as collateral for the loans, including prescription files, real estate and furnishings, according to a regulatory filing.
Walgreens, Rite Aid Divest 865 Stores To Fred’s Pharmacy For $950M
“The agreement is being entered into to respond to concerns identified by the [Federal Trade Commission] in its review of the proposed acquisition of Rite Aid by Walgreens Boots Alliance, which was announced in October 2015,” the companies said. “Walgreens Boots Alliance is actively engaged in discussions with the FTC regarding the transaction and is working toward a close of the Rite Aid acquisition in early calendar 2017.”
Walgreens to Shed at Least 865 Rite Aid Stores to save Mega-Merger
The trans-Atlantic drugstore operator said on Tuesday the combined company plans to sell at least 865 Rite Aid stores to small regional drugstore chain Fred’s for $950 million in cash. WBA said that if the FTC demanded a larger divestiture, Fred’s would be compelled to buy additional Rite Aid stores. The deal would turn the long struggling Fred’s chain from a small regional player into one of the biggest national players with a much bigger presence on the East and West Coasts.
Rite Aid selling 865 stores to Fred’s Inc. as part of Walgreens deal
The move comes after the Federal Trade Commission expressed antitrust concerns about Walgreens Boost Alliance Inc., which operates the Walgreens chain, acquiring Rite Aid. Tennessee-based Fred’s will pay $950 million in cash for the stores. Walgreens, the nation’s largest drugstore chain, will pay some $9.4 billion to acquire Rite Aid, the third largest. Walgreens initially said the Rite Aid deal could require it to divest itself of as many as 1,000 locations, with grocery store chain Kroger expressing interest in some stores. Kroger has 2,795 stores in 36 states with 2,200 in-store pharmacies.
Fred’s Rides to the Rescue for Walgreens
The Memphis, Tennessee-based retailer on Tuesday agreed to buy 865 drugstores from Walgreens Boots Alliance Inc. and Rite Aid Corp. for $950 million, a transaction that should help the two big chains win regulatory approval for their planned merger. But the deal is also a big win for Fred’s, and investors liked it so much they sent the company’s stock surging on the news: As of about noon Tuesday, the shares were up 75 percent and trading at $19.50 apiece.
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