DEERFIELD, Ill. — Walgreens Boots Alliance could be close to an agreement to sell more assets, including additional stores, distribution centers, software and personnel, to Fred’s Pharmacy in an effort to win Federal Trade Commission approval of its proposed agreement to acquire Rite Aid, according to Bloomberg, citing sources close to the talks.
“Walgreens could present the beefed-up package to the U.S. Federal Trade Commission within weeks, the [Bloomberg source] said, in hopes of satisfying the agency’s concerns after an initial proposal fell short,” the news outlet reported. It added that in addition to the FTC, at least a dozen states attorneys general had “scrutinized the deal.”
As part of the sweetened deal, Fred’s would also get the rights to the Rite Aid brand name for an extended period beyond the 24-month period outlined in the original deal, Bloomberg added in its report. “Senior Rite Aid executives could also move over to Fred’s, although exactly who and how many is still under discussion, according to the [source].”
Drug Store News reported one week ago that Walgreens was perhaps considering declaring it has “certified compliance” in its Rite Aid merger, forcing the FTC to vote on the proposed transaction in 30 days.
The proposed Walgreens-Rite Aid transaction was first proposed in Oct. 2015. Fred’s was already set to acquire at least 865 divested Rite Aid locations.
Wall Street reacted positively to this news, lifting the stocks of Fred’s and Rite Aid each by more than 2 percent during Tuesday afternoon trading.