Rite Aid has completed the first phase of its amended asset purchase agreement with Walgreens Boots Alliance. The company transferred 97 Rite Aid stores and related assets to Walgreens.
Under the deal, Walgreens will purchase a total of 1,932 stores, three distribution centers and related inventory from Rite Aid for an all-cash purchase price of $4.375 billion on a cash-free, debt-free basis. The companies expect to continue to transfer ownership of the stores in phases over the coming months, with the goal being to complete the store transfers in spring of 2018.
Rite Aid said it expects to use a substantial majority of the net proceeds from the transaction to repay existing indebtedness, and improving the company’s leverage levels
“Successfully completing the pilot closing and first subsequent closings marks an important step in realizing the full benefits of this transaction,” said John Standley, Rite Aid chairman and CEO. “I am proud of the entire Rite Aid team for their commitment and dedication to helping us reach this milestone. I also want to thank our team for their continued support as we complete the transfer process over the next several months and implement our plans to deliver improved results.”