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Friday, Jun 30 2017

Full Issue

Walgreens-Rite Aid Deal Latest In Series Of High-Profile Mergers To Be Thwarted By Antitrust Enforcers

The merger was worth $9.4 billion.

Walgreens Boots Alliance Inc. and Rite Aid Corp. scrapped their $9.4 billion merger agreement, the latest in a series of high-profile deals to be derailed by antitrust enforcers. Instead, Walgreens said it would seek to buy half of Rite RAD -26.46% Aid鈥檚 stores for $5.18 billion in cash. Executives said they had crafted the smaller deal to address regulatory issues, but antitrust experts said it doesn鈥檛 eliminate competition concerns. (Terlep and Kendall, 6/29)

The new agreement ends a saga that dragged on for more than a year and a half as the companies struggled to get approval from regulators. On Thursday, they said they would scrap the $7.37 billion takeover, and instead Walgreens will pay $5.18 billion to buy 2,186 stores, leaving Rite Aid as a regional chain. 鈥淭his deal is much simpler,鈥 Walgreens Chief Executive Officer Stefano Pessina said on a conference call. 鈥淚t is an asset deal so it is less controversial.鈥 (Langreth, 6/29)

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