Walgreens and Fred’s have entered into a definitive asset purchase agreement. Walgreens will acquire pharmacy patient prescription files and related pharmacy inventory of 185 Fred’s stores located across 10 Southeastern states.
Under the agreement, the aggregate consideration to be paid by Walgreens to Fred’s is $165 million, subject to adjustment, plus an amount equal to the value of related pharmacy inventory.
“This agreement increases patient access to Walgreens pharmacies in the Southeastern U.S., and allows us to introduce more people to Walgreens trusted pharmacy services in these communities. We look forward to welcoming Fred’s patients and team members who are hired into available Walgreens positions,” said Richard Ashworth, Walgreens president of operations.
Fred’s said it will continue to operate its retail stores at most of these locations after the pharmacies close. Once the transaction is complete, Fred’s will continue to operate approximately 162 pharmacies across nearly 600 stores.
“With this agreement, we have taken a major step towards achieving one of our main goals of eliminating our debt balance,” said Joe Anto, interim CEO and CFO of Fred’s. “We look forward to partnering with Walgreens to transition our pharmacy patients in these locations as smoothly as possible.”
The companies expect the file transfers to begin in the fourth quarter of 2018 and be completed in the first quarter of 2019.