Daily Data Dive

PYMNTS Daily Data Dive: Walgreens/Rite Aid

Since the Walgreens/Rite Aid merger is on track to create the largest drugstore operation in the U.S. with 46 percent market share, the companies are under increased pressure from antitrust regulators.

In order to meet regulatory requirements for a pending $9.4 billion merger, Walgreens and Rite Aid announced an agreement to sell 865 Rite Aid locations. The deal will leave the two brands with a proposed combination of a little under 12,000 stores.

A regional retail chain called Fred’s secured $1.65 billion in borrowings to fund the all-cash $950 million purchase, plus ongoing operating costs. In order receive to loans, Fred’s reportedly pledged nearly all of its assets as collateral, which includes real estate, furnishings and prescription files. The purchase is expected to more than double the company’s size and saw the shares of the business surge 85 percent to $20.75 on Tuesday’s (Dec. 20) afternoon trading.

Here are the numbers:

46 percent | Drugstore market share of Walgreens/Rite Aid merger

$9.4 billion | Value of pending merger between Walgreens Boots Alliance and Rite Aid

865 | Number of stores Rite Aid must sell to meet regulatory requirements

12,000 | Combined number of stores for the two companies after required sales

$1.65 billion | Borrowings retail chain Fred’s received to fund all-cash purchase of the stores

$950 million | Value of Fred’s purchase minus ongoing operating costs

>2X | The purchase could more than double Fred’s current size.

85 percent | Amount Fred’s shares surged

$20.75 | Value of Fred’s share on Tuesday afternoon


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