Walgreens Boots Alliance said it might have to divest more stores than previously indicated to gain FTC approval for its pending acquisition of Rite Aid Corporation.
In a statement, Walgreens Boots Alliance said the company and Rite Aid remain actively engaged with the Federal Trade Commission regarding its review of the pending acquisition. As a result of the progress of these discussions with the FTC staff, Walgreens Boots Alliance is exploring potential divestiture remedies to address certain issues raised in those discussions, the company said.
In order to expedite that process, Walgreens Boots Alliance now expects that the most likely outcome will be that the retailers will be required to divest more than the 500 stores previously communicated, but still continues to expect that fewer than 1,000 stores will be required to be divested. In addition, the company continues to believe that the acquisition will close in the second half of calendar 2016.
Taking into account its current expectation of store divestitures, Walgreens Boots Alliance continues to expect that the acquisition will be accretive to its adjusted earnings per share in the first full year after closing of the transaction. The company also continues to expect that it will realize synergies from the acquisition in excess of $1 billion, to be fully realized within three to four years of closing.
Walgreens Boots Alliance operates over 13,100 stores in 11 countries, with about 8,240 drug stores in 50 states. Rite Aid operates nearly 4,600 stores in 31 states.