The chief executive of Walgreens Boots Alliance said Thursday that the biggest US drug store chain was pressing on with its purchase of smaller Rite Aid, which was announced in October 2015 and has not closed.
Rite Aid said on Dec. 20 that it would sell 865 stores to Fred’s for US$950 million to satisfy antitrust concerns on the deal, which was valued at US$9.4 billion when it was announced in October 2015.
The Federal Trade Commission is assessing the proposed merger to ensure it complies with antitrust law.
“During the year, we also continued in our effort to get regulatory approval for our acquisition,” said Stefano Pessina, Walgreens Boots Alliance chief executive, at an annual shareholders meeting in New York City.
Pessina declined to detail issues raised in the review: “The only thing I can repeat is that we are actively engaged in dialogue with the FTC and we are doing everything we can to support their work,” he said.
Pessina said Walgreens was also talking to Rite Aid. “These discussions include taking into account anything required to gain approval for the transaction,” he said.
It could take two months for the agency to assess a proposed divestiture of that size since it would look at the proposed sales, store by store, and in detail, said David Balto, a former FTC official now in private practice.
“Retail market divestitures are very complex. It’s unrealistic to assume that they could get through a divestiture that’s this significant in a few weeks,” said Balto.
Full Content: Channel News Asia
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