Albertsons, Rite Aid merging
Boise, Idaho-based Albertsons Cos., one of the nation’s largest grocery retailers, and Camp Hill, Pa.-based Rite Aid Corp., one of the nation’s well-known drugstore chains, announced an agreement under which privately held Albertsons will merge with publicly traded Rite Aid.
The Albertsons-Rite Aid merger is expected to deliver annual revenue of $3.7 billion, according to a press release. The integrated company will operate approximately 4,900 locations, 4,350 pharmacy counters and 320 clinics across 38 states and Washington, D.C., serving more than 40 million customers per week. Most Albertsons pharmacies will be rebranded as Rite Aid, and the company will continue to operate Rite Aid stand-alone pharmacies.
Current Rite Aid Chairman and Chief Executive Officer John Standley will become Chief Executive Officer of the combined company, with current Albertsons Chairman and Chief Executive Officer Bob Miller serving as Chairman. The combined company is expected to be comprised of leadership from both companies and will be dual headquartered in Boise and Camp Hill. The name of the combined company will be determined by transaction close.
Albertsons and Rite Aid say the combination will provide customers with flexible and convenient access to range of food, health and wellness offerings and will deliver significant value to customers, employees and shareholders. The companies say the combining of their strong own-brand portfolios — Albertsons’ $1 billion own brands, including O Organics and Lucerne, and its manufacturing and operating capabilities, with Rite Aid’s own brands in health and wellness, including B4Y and Daylogic, and its pharmacy expertise — will allow the combined company to drive growth opportunities and efficiencies across its purchasing, marketing, manufacturing, and merchandising functions.
The merger is expected to close early in the second half of this year.
“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,” Standley said. “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.”
“The hallmark of Albertsons Companies’ business has been to become the favorite local supermarket of our customers,” said Bob Miller, Albertsons Chairman and CEO. “We have always put our customers first, and our combination with Rite Aid will enable us to even better serve the valuable pharmacy customer by providing a fully integrated one-stop-shop for our customers’ food, health, and wellness needs.”
Rite Aid is in the process of selling 1,932 of its approximately 4,600 stores to rival Walgreen Boots Alliance.