NY Post: Walgreens sets 3-month deadline for FTC approval of Rite Aid deal
NEW YORK — The latest move by Walgreens Boots Alliance in its pursuit of the Rite Aid deal may be a bet that a Trump-appointed FTC chief will finally push the deal through.
Walgreens Boots Alliance will be looking to force approval of its proposed merger with Rite Aid through a declaration of “certified compliance” — a notification that a merger applicant believes it has supplied all the information regulators need to make a decision on the deal, The New York Post reported Thursday.
According to the report, Walgreens Boots Alliance has set a deadline for deal approval of roughly three months, or about one month in advance of the expiration of the current merger agreement of July 31.
"A key to Walgreens' decision to certify compliance with the second request would be the current makeup of the FTC," George Hill, research analyst for Deutsche Bank, noted. "The body normally has five board members to vote on these transactions. ... Currently, three seats are vacant with the sitting commissioner being a Democrat [Terrell McSweeny] and the chairperson being a Republican [Maureen Olhausen]. According to expectations among the investment community, the Republican member is unlikely to vote against the deal, while the Democrat could oppose the deal, with the body's inability to come to a conclusion allowing the deal to proceed through the FTC's inaction."
“Typically, such declarations ... also prevent the commission from ruling well ahead of the deadline,” the Post report said. "Specifically, Walgreens appears to be wagering that President Trump will install a deal-friendly commissioner to review the deal, insiders said."
The Post noted that sources close to Trump have said he is considering Utah attorney general Sean Reyes for the position.
The Walgreens-Rite Aid proposed merger was first announced in Oct. 2015. If the deal goes through, Fred’s Pharmacy would buy at least 865 divested Rite Aid stores.
To read the full report, click here.