Photo

A Walgreens store in New York. Under the terms of the deal, Rite Aid will receive a $325 million termination fee.

Credit
Reuters

Walgreens Boots Alliance and Rite Aid said on Thursday that they had called off their planned merger, ending nearly two years of negotiations between the top drugstores.

Instead, Rite Aid will sell 2,186 stores and three distribution centers to Walgreens for $5.175 billion.

The new agreement will annul not only the planned sale of Rite Aid to Walgreens but also the sale of some Rite Aid stores to Fred’s Inc., a related transaction aimed at helping the two companies win antitrust approval.

Thursday’s announcement signals an end to the proposed union, after the two companies reportedly received pushback from antitrust regulators worried about reduced competition in the drugstore industry. In January, the two companies said they would reduce the price of the proposed sale.

Under the terms of the deal agreement, Rite Aid will receive a $325 million termination fee.

Shares in Rite Aid tumbled more than 11 percent in premarket trading after the announcement, to $3.52 a share.

Continue reading the main story



Source link