Rite Aid Corporation (NYSE: RAD) today provided an update on the
progress of its plans to sell stores to Walgreens Boots Alliance,
Inc. (Nasdaq: WBA) pursuant to the previously disclosed Amended and
Restated Asset Purchase Agreement, dated as of September 18, 2017
(the “Asset Purchase Agreement”). As of March 2, 2018, Rite Aid has
transferred 1,651 stores and related assets to WBA, and has
received cash proceeds of $3.6 billion, which the Company continues
to use to reduce debt. Under the Asset Purchase Agreement, WBA will
purchase a total of 1,932 stores, three distribution centers and
related inventory from Rite Aid for an all-cash purchase price of
$4.4 billion on a cash-free, debt-free basis. Rite Aid expects to
complete the store transfer process in the spring of 2018.
The majority of the closing conditions have been satisfied, and
the subsequent transfers of Rite Aid stores and related assets
remain subject to minimal customary closing conditions applicable
only to the stores being transferred at such subsequent closing, as
specified in the Asset Purchase Agreement. Additional details
regarding today’s announcement have been filed with the Securities
and Exchange Commission on Form 8-K.
Rite Aid is one of the nation's leading drugstore chains with
fiscal 2017 annual revenues of $32.8 billion. Information about
Rite Aid, including corporate background and press releases, is
available through the company's website at www.riteaid.com.
Cautionary Statement Regarding Forward Looking
Statements
Statements in this release that are not historical, are
forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Such statements include, but are not limited to, statements
regarding the expected timing of subsequent closings of the sale of
Rite Aid stores and assets to WBA; the ability of the parties to
complete each of the subsequent closings for sale and related
subsequent transactions considering the various closing conditions
applicable to the stores, related assets and/or distribution
centers being transferred at such subsequent closing; the outcome
of legal and regulatory matters in connection with the sale of
stores and assets of Rite Aid to WBA; the expected benefits of the
transactions such as improved operations, growth potential, market
profile and financial strength; the competitive ability and
position of Rite Aid following completion of the proposed
transactions; the ability of Rite Aid to implement new business
strategies following the completion of the proposed transactions;
the ability of Rite Aid to repay its debt using the proceeds from
the proposed transactions and any assumptions underlying any of the
foregoing. Words such as “anticipate,” “believe,” “continue,”
“could,” “estimate,” “expect,” “intend,” “may,” “plan,” “predict,”
“project,” “should,” and “will” and variations of such words and
similar expressions are intended to identify such forward-looking
statements. These forward-looking statements are not guarantees of
future performance and involve risks, assumptions and
uncertainties, including, but not limited to, our high level of
indebtedness and our ability to make interest and principal
payments on our debt and satisfy the other covenants contained in
our debt agreements; general economic, industry, market,
competitive, regulatory and political conditions; our ability to
improve the operating performance of our stores in accordance with
our long term strategy; the impact of private and public
third-party payers continued reduction in prescription drug
reimbursements and efforts to encourage mail order; our ability to
manage expenses and our investments in working capital; outcomes of
legal and regulatory matters; changes in legislation or
regulations, including healthcare reform; our ability to achieve
the benefits of our efforts to reduce the costs of our generic and
other drugs; risks related to the proposed transactions, including
the possibility that the subsequent transactions may not close,
including because a governmental entity may prohibit, delay or
refuse to grant approval for the consummation of the transactions,
or may require conditions, limitations or restrictions in
connection with such approvals, the risk that there may be a
material adverse change of Rite Aid, or the business of Rite Aid
may suffer as a result of uncertainty surrounding the proposed
transactions; risks related to the ability to realize the
anticipated benefits of the proposed transactions; risks associated
with the financing of the proposed transaction; disruption from the
proposed transaction making it more difficult to maintain business
and operational relationships; the effect of the pending sale on
Rite Aid’s business relationships (including, without limitation,
customers and suppliers), operating results and business generally;
risks related to diverting management’s or employees’ attention
from ongoing business operations; the risk that Rite Aid’s stock
price may decline significantly if the proposed transaction is not
completed; significant transaction costs; unknown liabilities; the
risk of litigation and/or regulatory actions related to the
proposed transactions; potential changes to our strategy in the
event the remaining proposed transactions do not close, which may
include delaying or reducing capital or other expenditures, selling
assets or other operations, attempting to restructure or refinance
our debt, or seeking additional capital, and other business
effects.
These and other risks, assumptions and uncertainties are more
fully described in Item 1A (Risk Factors) of our most recent Annual
Report on Form 10-K, and in other documents that we file or furnish
with the Securities and Exchange Commission, which you are
encouraged to read.Should one or more of these risks or
uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those indicated
or anticipated by such forward-looking statements. Accordingly, you
are cautioned not to place undue reliance on these forward- looking
statements, which speak only as of the date they are made. Rite Aid
expressly disclaims any current intention to update publicly any
forward-looking statement after the distribution of this release,
whether as a result of new information, future events, changes in
assumptions or otherwise.
Additional Information and Where to Find It
In connection with the proposed strategic combination involving
Rite Aid and Albertsons Companies, Inc. (“Albertsons”), Rite Aid
and Albertsons intend to file relevant materials with the SEC,
including that Albertsons will file a registration statement on
Form S-4 that will include a proxy statement/prospectus to be
distributed to Rite Aid’s stockholders. Rite Aid will mail the
proxy statement/prospectus and a proxy card to each stockholder
entitled to vote at the special meeting relating to the proposed
merger. INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS
WHEN IT BECOMES AVAILABLE BECAUSE IT WILL CONTAIN IMPORTANT
INFORMATION. RITE AID’S EXISTING PUBLIC FILINGS WITH THE SEC SHOULD
ALSO BE READ, INCLUDING THE RISK FACTORS CONTAINED THEREIN.
Investors and security holders may obtain copies of the Form
S-4, including the proxy statement/prospectus, as well as other
filings containing information about Rite Aid, free of charge, from
the SEC’s Web site (www.sec.gov). Investors and security holders
may also obtain Rite Aid’s SEC filings in connection with the
transaction, free of charge, from Rite Aid’s Web site
(www.RiteAid.com) under the link “Investor Relations” and then
under the tab “SEC Filings,” or by directing a request to Rite Aid,
Byron Purcell, Attention: Senior Director, Treasury Services &
Investor Relations. Copies of documents filed with the SEC by
Albertsons will be made available, free of charge, on Albertsons
website at www.albertsonscompanies.com.
Participants in Solicitation
Rite Aid, Albertsons and their respective directors, executive
officers and employees and other persons may be deemed to be
participants in the solicitation of proxies from the holders of
Company common stock in respect of the proposed transaction.
Information regarding Rite Aid’s directors and executive officers
is available in its definitive proxy statement for Rite Aid’s 2017
annual meeting of stockholders filed with the SEC on June 7, 2017,
as modified or supplemented by any Form 3 or Form 4 filed with the
SEC since the date of such definitive proxy statement. Information
about the directors and executive officers of Albertsons will be
set forth in the Form S-4. Other information regarding the
interests of the participants in the proxy solicitation will be
included in the proxy statement/prospectus when it becomes
available. These documents can be obtained free of charge from the
sources indicated above. This communication shall not constitute an
offer to sell or the solicitation of an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be
any sale of securities in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such jurisdiction.
No offer of securities shall be made except by means of a
prospectus meeting the requirements of Section 10 of the Securities
Act of 1933, as amended.
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version on businesswire.com: http://www.businesswire.com/news/home/20180305006179/en/
Rite Aid CorporationINVESTORS:Byron Purcell, 717-975-5809or
investor@riteaid.comorMEDIA:Susan Henderson, 717-730-7766
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