Fred's To Buy 865 Stores From Rite Aid For $950 Mln - Quick Facts

(RTTNews) - Fred's Inc. (FRED) announced the company has signed an agreement with Walgreens Boots Alliance, Inc. (WBA) and Rite Aid Corp. (RAD) to purchase 865 stores and certain assets related to store operations located across the eastern and western United States for $950 million. Upon completion, Fred's will operate the acquired stores and will retain the Rite Aid banner through a 24-month transition.

Fred's Pharmacy expects that the acquired stores would be accretive to earnings and generate substantial cash flow. The company noted that, in aggregate, the 865 stores are generally representative of Rite Aid's pre-divesture store performance with respect to both sales and EBITDA.

Fred's said the transaction, if approved, is targeted to close during the first half of 2017 and will position Fred's Pharmacy as the third-largest drugstore chain in the United States. The company noted that closing of the transaction is expected to take several months after Walgreens' proposed acquisition of Rite Aid is completed.