Rite Aid Corporation (NYSE: RAD) today announced that it has
commenced an offer to purchase for cash (the “Asset Sale Offer”) up
to $700,000,000 of certain of its outstanding indebtedness,
consisting of its 6.75% Senior Notes due 2021 and 6.125% Senior
Notes due 2023 (collectively, the “Notes”), with a portion of the
net cash proceeds received from its previously announced sale to
Walgreens Boots Alliance, Inc. of 1,932 stores, three distribution
centers and related inventory for an all-cash purchase price of
$4.375 billion on a cash-free, debt-free basis. The Asset Sale
Offer is being made pursuant to the indentures governing the Notes
(collectively, the “Indentures”) and an Offer to Purchase, dated
April 19, 2018 and related Letter of Transmittal, which more fully
set forth the terms and conditions of the Asset Sale Offer.
The Asset Sale Offer will expire at 5:00 P.M., Eastern Time, on
May 21, 2018, unless extended or earlier terminated. Under the
terms of the Asset Sale Offer, holders of the Notes who validly
tender and do not withdraw their Notes prior to 5:00 P.M., Eastern
Time, on May 21, 2018 (as such time and date may be extended) and
whose Notes are accepted for purchase, will receive the applicable
“Purchase Price,” which is the same for each series of Notes and
equals 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 series of Notes up to the date of
payment. As provided in the Indentures, if at the Expiration Date
the Notes tendered exceeds $700,000,000, Rite Aid will purchase
Notes on a pro rata basis (both by series and within each series).
In the event that less than $700,000,000 in principal amount of
Notes is tendered in the Asset Sale Offer, all of the tendered
Notes will be repurchased by Rite Aid.
6.75% Senior Notes due 2021
Title of Security CUSIP Number
Principal Amount Outstanding Purchase Price(1)
6.75% Senior Notes due 2021 767754 CG7 $806,529,000
$1,000.00 plus accrued and unpaidinterest,
if any, to the purchase date
6.125% Senior Notes due 2023
Title of Security CUSIP Number
Principal Amount Outstanding Purchase Price(1)
6.125% Senior Notes due 2023 767754 CH5 $1,758,249,000
$1,000.00 plus accrued and unpaidinterest,
if any, to the purchase date
_________________ (1) Per $1,000.00 principal amount of
Notes validly tendered and accepted for purchase. As provided in
the Indentures, if at the Expiration Date the Notes tendered
exceeds $700,000,000, Rite Aid will purchase Notes on a pro rata
basis (both by series and within each series). In the event that
less than $700,000,000 in principal amount of Notes is tendered in
the Asset Sale Offer, all of the tendered Notes will be repurchased
by Rite Aid.
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.
Requests for documents relating to the Asset Sale Offer may be
directed to The Bank of New York Mellon Trust Company, N.A., the
Depositary and Paying Agent, at (315) 414-3349.
Rite Aid is one of the nation’s leading drugstore chains with
fiscal 2018 revenues from continuing operations of $21.5 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 (the “Merger”) between Rite Aid and
Albertsons Companies, Inc. (“Albertsons”); the expected timing of
the closing of the Merger and the subsequent closings of the sale
of Rite Aid distribution centers and assets to Walgreens Boots
Alliance, Inc. (“WBA”); the ability of the parties to complete the
Merger considering the various closing conditions to the Merger;
the ability of the parties to complete the distribution center
closing considering the various closing conditions applicable to
the distribution centers and related assets being transferred at
such distribution center closing; the outcome of legal and
regulatory matters in connection with the Merger and 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
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 with WBA,
including the possibility that the remaining transactions may not
close, or the business of Rite Aid may suffer as a result of
uncertainty surrounding the proposed transactions; risks related to
the expected timing and likelihood of completion of the Merger,
including the risk that the Merger may not close due to one or more
closing conditions to the Merger not being satisfied or waived,
such as the remaining Ohio Department of Insurance regulatory
approval 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 Merger 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 Rite Aid was not obtained; risks related to the
ability to realize the anticipated benefits of the proposed
transactions with Albertsons and WBA; risks related to diverting
management's or employees' attention from ongoing business
operations; the risk that any announcements relating to the Merger
could have adverse effects on the market price of Rite Aid’s common
stock, and the risk that the Merger and its announcement could have
an adverse effect on the ability of Rite Aid 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; the risk that Rite Aid's stock price may
decline significantly if the Merger or sale of distribution centers
and related assets to WBA is not completed; the occurrence of any
event, change or other circumstances that could give rise to the
termination of the merger agreement (including circumstances
requiring Rite Aid to pay Albertsons a termination fee pursuant to
the merger agreement);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 the registration
statement on Form S-4, as it may be amended, that was filed with
the SEC by Albertsons on April 6, 2018 in connection with the
Merger, and in other documents that we file or furnish with the
Securities and Exchange Commission (the “SEC”), 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 merger involving Rite Aid and
Albertsons, Rite Aid and Albertsons have prepared and Albertsons
has filed with the SEC on April 6, 2018 a registration statement on
Form S-4 that includes a proxy statement of Rite Aid that also
constitutes a prospectus of Albertsons. The registration statement
is not yet final and will be amended. 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.
Rite Aid and Albertsons also plan to file other relevant documents
with the SEC regarding the proposed merger. INVESTORS ARE URGED TO
READ THE DEFINITIVE PROXY STATEMENT/PROSPECTUS WHEN IT BECOMES
AVAILABLE, AS WELL AS OTHER DOCUMENTS FILED WITH THE SEC, BECAUSE
THEY 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
Rite Aid 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 is set
forth in the registration statement on Form S-4, including the
proxy statement/prospectus, as it may be amended, that has been
filed with the SEC on April 6, 2018. Other information regarding
the interests of the participants in the proxy solicitation may be
included in the definitive proxy statement/prospectus when it
becomes available. These documents can be obtained free of charge
from the sources indicated above.
Non-Solicitation
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/20180419006425/en/
Rite Aid CorporationINVESTORS:Byron Purcell717-975-5809or
investor@riteaid.comorMEDIA:Susan Henderson717-730-7766
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