Albertsons is plunging deeper into the pharmacy business with a deal to buy Rite Aid, the nation’s third-largest drugstore chain, for an undisclosed amount.
The grocery store chain—which owns Safeway, Vons and other grocery brands—is offering either a share of its stock and $1.83 in cash or slightly more than a share for every 10 shares of Rite Aid, according to a statement the companies released today.
Shareholders of Boise, Idaho-based Albertsons will own more than 70% of the combined company. The deal should close in the second half of this year, but regulators and Rite Aid shareholders still have to approve it, the companies say.
Rite Aid Chairman and CEO John Standley will lead the combined company as CEO, while Albertsons leader Bob Miller will serve as chairman. The companies say they will keep headquarters in both Boise and Camp Hill, Pennsylvania, which is where Rite Aid is based.
Albertsons says it will continue to run Rite Aid stand-alone stores. The pharmacy chain said earlier this year that it runs around 4,400 stores. Most of Albertson’s in-store pharmacies will be rebranded as Rite Aid.
Walgreens had tried unsuccessfully to buy the chain, but the company scuttled that push last year after encountering regulatory resistance. Last September, Walgreens agreed to buy nearly 2,000 Rite Aid locations and some distribution centers for about $4.38 billion. Rite Aid said late last month that it had transferred about 625 stores to Walgreens.
