Walgreens Boots, Rite Aid Extend Merger Process

Walgreens Boots Alliance and Rite Aid Corp. have entered into an amendment and extension of their previously announced definitive merger agreement.

Under the agreement, Walgreens Boots Alliance aims to acquire all outstanding shares of Rite Aid.

Walgreens Boots Alliance and Rite Aid agreed to extend the end date set for merger execution under the previously announced agreement from January 27 to July 31 in order to allow the parties additional time to obtain regulatory approval, the companies stated.

As part of the amendment, the two companies have agreed to reduce the price for each share of Rite Aid common stock that Walgreens Boots Alliance will pay. The revised price will be a maximum of $7 per share and a minimum of $6.50 per share. Walgreens Boots Alliance has agreed 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 depend on the number of required store divestitures, with the price set at $7 per share if 1,000 stores or fewer must be divested to win regulatory approval 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 a pro-rata adjustment of the price per share will occur. The Walgreens Boots arrangement to divest up to 1,200 Rite Aid stores represents an increase of up to 200 stores over the 1,000 stores that it had agreed to divest under terms of the original agreement.