Photo credit: CNBC video
– Editor’s note:
Rite-Aid has been in play as a take-over/merger target by Walgreen’s and Albertsons/Safeway, both of which fell through. Rite Aid may eventually be merged into some other conglomerate and the Yelm store would then change hands.
– “Rite Aid and Albertsons terminate merger amid opposition to deal”
“Drug store chain Rite Aid Corp (RAD.N) and U.S. grocer Albertsons Companies Inc ABS.N agreed to terminate their merger agreement, the companies said on Wednesday, a little over 10 days after a shareholder advisory firm opposed the deal.
“Last month, Institutional Shareholder Services Inc (ISS) had said that Rite Aid investors should vote down its $24 billion merger with Albertsons saying the agreement was not going to give the drug store chain’s shareholders a “fair ownership interest” in the combined company.
“The ISS report was seen as a blow to Albertsons and its majority owner, private equity firm Cerberus Capital Management LP, who were hoping that the deal will help them win a new business amid pressure from retailer Amazon.com Inc (AMZN.O) and Walmart Inc (WMT.N),” by Kanishka Singh, Reuters.
– “The now-scrapped Rite Aid-Albertsons merger was never going to solve the companies’ problems”
“Rite Aid Corp. shares closed Thursday down 11.5% after news that its deal with Albertsons Cos. isn’t going to happen, but the merger probably wouldn’t have delivered the big benefits both companies promised anyway, according to GlobalData Retail.”
“While the deal would have helped Albertsons in the pharmacy and health space and expanded its geographic presence, GlobalData Retail Managing Director Neil Saunders doesn’t think the merger was a particularly good one from the start.”
“While there was a lot of talk from both sides about how the combined company would evolve in significant ways, ultimately the result would’ve been much less grand.”
“Now that the deal is off, there could be trouble ahead for Rite Aid,” by Tonya Garcia, MarketWatch.
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