Walgreens and Rite Aid on Thursday pronounced they scrapped their $17.2 billion merger, following inspection from US antitrust regulators.
This sent shockwaves to Fred’s, a pharmacy sequence that had approaching to buy scarcely 1,000 stores from Rite Aid. Fred’s shares cratered by as most as 24% in early trading.
Fred’s announced in Dec that it entered an asset-purchase agreement with Rite Aid and Walgreens to buy 865 stores and some egghead properties, as good as assume some liabilities. But this agreement was consummated with a finish of a merger.
“This is a unsatisfactory outcome; however, a stop of a transaction has no impact on a company’s mutation devise or a ability to execute,” pronounced Michael Bloom, Fred’s CEO.
Fred’s pronounced it would accept $25 million in payment for a costs compared with a consummated transaction.
The pharmacy sequence pronounced Wednesday that it adopted a rights plan, famous as a poison pill, to revoke chances that a customer would benefit control of a association by open-market purchases of the stock. It has a trigger of 10% and will end on Sep 25, Reuters reported.
Walgreens said Thursday that it entered into an agreement to acquire 2,186 Rite Aid stores and associated resources for $5.18 billion.