Rite Aid Corporation (NYSE: RAD) today announced the results of
its previously announced offer to purchase (the “Asset Sale Offer”)
up to $900,000,000 of its outstanding 9.25% Senior Notes due 2020
(the “2020 Notes”), 6.75% Senior Notes due 2021 (the “2021 Notes”)
and 6.125% Senior Notes due 2023 (the “2023 Notes” and, together
with the 2020 Notes and the 2021 Notes, the “Notes”) for cash at a
price equal to 100% of the principal amount of the Notes,
equivalent to $1,000 per $1,000 principal amount of Notes, plus
accrued and unpaid interest, if any, for such Notes up to the date
of purchase. The Asset Sale Offer was made pursuant to the
respective indentures governing the Notes and an Offer to Purchase
and related Letter of Transmittal, each dated February 27,
2018.
As of 5:00 P.M., Eastern Time, on March 29, 2018 (the
expiration date with respect to each series of Notes), $3,454,000
principal amount of the 2020 Notes, representing 0.38% of the
outstanding principal amount of the 2020 Notes, $3,471,000
principal amount of the 2021 Notes, representing 0.43% of the
outstanding principal amount of the 2021 Notes and $41,751,000
principal amount of the 2023 Notes, representing 2.32% of the
outstanding principal amount of the 2023 Notes, had been validly
tendered and accepted for purchase by Rite Aid. As previously
announced, Rite Aid has issued a notice of redemption for all of
the 2020 Notes that remain outstanding on April 12, 2018 (the
“Redemption Date”) at a purchase price equal to 100% of the
principal amount of the 2020 Notes to be redeemed plus accrued and
unpaid interest, if any, to but excluding the Redemption Date.
This press release does not constitute a notice of redemption
under the optional redemption provisions of the Indentures, nor
does it constitute an offer to sell, or a solicitation of an offer
to buy, any security. No offer, solicitation, or sale will be made
in any jurisdiction in which such an offer, solicitation, or sale
would be unlawful.
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 pending merger between the Company and Albertsons
Companies, Inc. (“Albertsons”) and the transactions contemplated
thereby, and the parties perspectives and expectations, are forward
looking statements. Such statements include, but are not limited
to, statements regarding the benefits of the proposed merger,
integration plans, expected synergies and revenue opportunities,
anticipated future financial and operating performance and results,
including estimates for growth, the expected management and
governance of the combined company, and the expected timing of the
transactions contemplated by the merger agreement and any
assumptions underlying any of the foregoing. Such statements also
include statements regarding the expected timing of the closing of
the sale of remaining stores and assets to Walgreens Boots
Alliance, Inc. (“WBA”); the ability of the parties to complete the
sale and related transactions considering the limited remaining
closing conditions; the outcome of legal and regulatory matters in
connection with the sale of store and assets of the Company 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 the Company
following completion of the proposed transactions; the ability of
the Company to implement new business strategies following the
completion of the proposed transactions and any assumptions
underlying any of the foregoing. The words “expect,” “believe,”
“estimate,” “intend,” “plan” and similar expressions indicate
forward-looking statements. These forward-looking statements are
not guarantees of future performance and are subject to various
risks and uncertainties, assumptions (including assumptions about
general economic, market, industry and operational factors), known
or unknown, which could cause the actual results to vary materially
from those indicated or anticipated. Such risks and uncertainties
include, but are not limited to, the Company’s high level of
indebtedness and ability to make interest and principal payments on
its debt and satisfy the other covenants contained in its debt
agreements; risks related to the expected timing and likelihood of
completion of the pending merger with Albertsons, including the
risk that the transaction may not close due to one or more closing
conditions to the transaction not being satisfied or waived, such
as regulatory approvals not being obtained, on a timely basis or
otherwise, or that a governmental entity prohibited, delayed or
refused to grant approval for the consummation of the transaction
or required certain conditions, limitations or restrictions in
connection with such approvals, or that the required approval of
the merger agreement by the stockholders of the Company was not
obtained; risks related to the ability of Albertsons and the
Company to successfully integrate the businesses; the occurrence of
any event, change or other circumstances that could give rise to
the termination of the merger agreement (including circumstances
requiring the Company to pay Albertsons a termination fee pursuant
to the merger agreement); the risk that there may be a material
adverse change of the Company or Albertsons; risks related to
disruption of management time from ongoing business operations due
to the proposed transactions with WBA and Albertsons; the risk that
any announcements relating to the proposed transactions could have
adverse effects on the market price of the Company’s common stock,
and the risk that the proposed transactions and their announcements
could have an adverse effect on the ability of the Company to
retain customers and retain and hire key personnel and maintain
relationships with their suppliers and customers and on their
operating results and businesses generally; risks related to
successfully integrating the businesses of the Company and
Albertsons, which may result in the combined company not operating
as effectively and efficiently as expected; the risk that the
combined company may be unable to achieve cost-cutting synergies or
it may take longer than expected to achieve those synergies; risks
associated with the financing of the proposed transaction with
Albertsons; risks related to the proposed asset sale transactions
with WBA, including the risk that the Company and WBA cannot
complete the sale and related transactions considering the limited
remaining closing conditions; risks related to the ability to
realize the anticipated benefits of the proposed transactions;
disruption from the proposed transaction making it more difficult
to maintain business and operational relationships; the effect of
the pending sale on the Company’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 the Company’s stock price may decline
significantly if the remaining proposed transactions are not
completed; significant transaction costs; unknown liabilities; the
risk of litigation and/or regulatory actions related to the
proposed transactions; potential changes to the Company’s 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 its debt, or seeking additional capital,
and other business effects; general economic, industry, market,
competitive, regulatory and political conditions; the Company’s
ability to improve the operating performance of its stores in
accordance with its long term strategy; the impact of private and
public third-party payers continued reduction in prescription drug
reimbursements and efforts to encourage mail order; the Company’s
ability to manage expenses and its investments in working capital;
outcomes of legal and regulatory matters; changes in legislation or
regulations, including healthcare reform; the Company’s ability to
achieve the benefits of its efforts to reduce the costs of the
Company’s generic and other drugs. These and other risks,
assumptions and uncertainties can be found in the Company’s Annual
Report on Form 10-K for the fiscal year ended March 4, 2017 filed
with the SEC and will be found in the Form S-4 that will be filed
with the SEC by Albertsons in connection with the proposed merger,
and other documents that the parties may 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. Forward-looking statements relate only to the date they
were made, and the Company undertakes no obligation to update
forward-looking statements to reflect events or circumstances after
the date they were made except as required by law or applicable
regulation. All information regarding the Company assumes
completion of the Company’s previously announced transaction with
Walgreens Boots Alliance, Inc. There can be no assurance that the
consummation of such transaction will be completed on a timely
basis, if at all. For further information on such transaction, see
the Company’s Form 8-K filed with the SEC on February 8, 2018.
Additional Information and Where to Find It
In connection with the proposed strategic combination involving
the Company and Albertsons, the Company 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 the Company’s
stockholders. The Company 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. THE
COMPANY’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 the Company, free of charge,
from the SEC’s Web site (www.sec.gov). Investors and security
holders may also obtain the Company’s SEC filings in connection
with the transaction, free of charge, from the Company’s Web site
(www.RiteAid.com) under the link “Investor Relations” and then
under the tab “SEC Filings,” or by directing a request to the
Company, 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’s website at www.albertsonscompanies.com.
Participants in Solicitation
The Company, 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 the Company’s directors and executive
officers is available in its definitive proxy statement for the
Company’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: https://www.businesswire.com/news/home/20180330005123/en/
Rite Aid CorporationINVESTORS:Byron Purcell,
717-975-5809investor@riteaid.comorMEDIA:Susan Henderson,
717-730-7766
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