Last updated on February 1st, 2017 at 09:28 am
Walgreens Boots Alliance and Rite Aid Corp. on Monday have extended their previously announced definitive merger agreement under which Walgreens Boots Alliance will acquire Rite Aid. The agreement extends the time period in which the companies can obtain regulatory approval to merge from Jan. 27 to July 31, 2017.
Under the terms of the amendment, the parties have agreed to reduce the price for each share of Rite Aid common stock to be paid by Walgreens. The revised price will be a maximum of $7 per share and a minimum of $6.50 per share. In addition, Walgreens will be required to divest up to 1,200 Rite Aid stores, and certain additional related assets if required, to obtain regulatory approval. The exact price per share will be determined based on the number of required store divestitures, with the price set at $7 per share if 1,000 stores or fewer are required for divestiture and at $6.50 per share if 1,200 stores are required for divestiture. If the required divestitures fall between 1,000 and 1,200 stores, then there will be a pro-rata adjustment of the price per share.
Walgreens’ agreement to divest up to 1,200 Rite Aid stores represents an increase of up to 200 stores over the 1,000 stores that Walgreens had agreed to divest—most of which Fred’s Inc. has agreed to acquire—under the terms of the original agreement.
