Walgreens to Divest Up to 1,000 Stores for Rite Aid Merger
DEERFIELD, Ill. — With its acquisition of Rite Aid Corp. on track to close later this year, Walgreens Boosts Alliance Inc. expects to sell between 500 and 1,000 stores.
The divesture will ease antitrust concerns surrounding its multibillion-dollar acquisition of its Camp Hill, Pa.-based competitor.
According to Walgreens, the Deerfield-based company is "actively engaged" with Federal Trade Commission regulators. The company still expects the deal to close in the second half of 2016.
Taking into account its current expectation of store divestitures, Walgreens continues to expect that the acquisition will be accretive to its adjusted earnings per share in the first full year after closing of the transaction.
The company also continues to expect that it will realize synergies from the acquisition in excess of $1 billion, to be fully realized within three to four years of closing.
As CSNews Online previously reported, in October Walgreens Boots Alliance Inc. said it will acquire all outstanding shares of Rite Aid Corp. for $9 per share in cash, for a total enterprise value of approximately $17.2 billion, including acquired net debt.
Upon completion of the merger, Rite Aid will be a wholly owned subsidiary of Walgreens Boots Alliance, and is expected to initially operate under its existing brand name.
Walgreens Boots Alliance has more than 13,100 stores in 11 countries, and more than 350 distribution centers delivering to more than 200,000 pharmacies, doctors, health centers and hospitals each year in 19 countries.
Rite Aid Rite Aid is a drugstore chain with nearly 4,600 stores in 31 states and Washington, D.C.