Albertsons and Rite Aid Announced the Merger Agreement

Published on: 20 Feb, 2018

Albertsons Companies, one of the nation’s largest grocery retailers, announced on Tuesday a merger agreement with the publicly traded leading drugstore chain Rite Aid Corporation (NYSE: RAD) in a cash and stock deal. The transaction has been approved by the boards of directors of both companies, and is expected to close early in the second half of calendar year 2018.

Under the terms of the agreement, in exchange for every 10 shares of Rite Aid common stock, Rite Aid shareholders will have the right to elect to receive either one share of Albertsons Companies common stock plus approximately $1.83 in cash, or 1.079 shares of Albertsons Companies stock.

A combined Albertsons and Rite Aid would have a value of roughly $24 billion, including debt. Shareholders of Rite Aid will own a 28.0 percent to 29.6 percent stake in the combined company, and current Albertsons Companies shareholders will own a 70.4 percent to 72.0 percent stake in the combined company on a fully diluted basis. After the deal closes, Albertsons shares are expected to be traded on the New York Stock Exchange.

Current Rite Aid Chairman and Chief Executive Officer John Standley will be Chief Executive Officer of the combined company, with current Albertsons Companies Chairman and Chief Executive Officer Bob Miller serving as Chairman.

“This powerful combination enables us to become a truly differentiated leader in delivering value, choice, and flexibility to meet customers’ evolving food, health, and wellness needs,” said John Standley. “The combined platform positions Rite Aid to capitalize on our pharmacy expertise and expand and enhance our pharmacy footprint. We are confident that delivering improved customer experiences and value will drive growth and profitability while creating compelling long-term value for shareholders.”


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