Albertsons to acquire Rite Aid

Albertsons Cos. plans to acquire the rest of Rite Aid that is not being sold to Walgreens Boots Alliance. The community pharmacy chain and Albertsons have a combined value of approximately $24 billion, including debt. Rite Aid has a market value of about $2.3 billion and is in the process of selling a chunk of its stores to Walgreens.

Albertsons Cos. plans to acquire the rest of Rite Aid that is not being sold to Walgreens Boots Alliance. The community pharmacy chain and Albertsons have a combined value of approximately $24 billion, including debt. Rite Aid has a market value of about $2.3 billion and is in the process of selling a chunk of its stores to Walgreens. Following the proposed cash-and-stock deal, shareholders of closely held Albertsons, owner of Safeway and 19 other supermarket chains, would hold about 71% of the combined company, while Rite Aid investors would own the rest. For Rite Aid, the deal represents another way to gain size after the federal government blocked its full sale to Walgreens, which now plans to buy roughly 2,000 of Rite Aid's stores. The chief executives of the companies said in interviews Monday that the merger is the best way for them to compete in businesses increasingly threatened by Amazon.com. John Standley, Rite Aid's CEO, said the merger will help the company expand its food offerings to stand out from CVS Health, Walgreens, and Walmart. All three of the biggest pharmacy chains in the United States are now pursuing deals in a sign of the threats they face as customers increasingly shop online. CVS has agreed to buy Aetna, and Walgreens, in addition to the scaled-back Rite Aid deal, is in talks to buy AmerisourceBergen.