Time frame for closing of agreement would extend into September
According filings with the Securities and Exchange Commission yesterday, WBA and Rite Aid agreed to withdraw their initial Hart-Scott-Rodino (HSR) Antitrust Improvements Act notification and report filing, dated July 17, and refile it with the Department of Justice and the Federal Trade Commission by Aug. 18.
The move would reset the companies’ HSR waiting period to expire on Sept. 18, unless otherwise extended or terminated.
Under the HSR Act, the waiting period is typically 30 days. The parties may not close their deal until that period has passed.
On June 29, WBA and Rite Aid announced the termination of their $14 billion merger deal and unveiled a new pact in which WBA plans to buy 2,186 stores, three distribution centers and related inventory from Rite Aid for $5.175 billion in cash. WBA, too, agreed to pay Rite Aid a $325 million merger termination fee.
The cancellation of the Walgreens-Rite Aid merger also meant the termination of a deal with Fred’s Inc. to acquire stores slated for divestiture. In December, Fred’s had agreed to buy 865 or more Rite Aid stores in connection with the merger.
WBA’s original acquisition offer for Rite Aid on Oct. 27, 2015, was for $9 per share and the assumption of over $7 billion in net debt, for a total deal value of $17.2 billion.
WBA and Rite Aid amended the merger agreement on Jan. 30. The revised price for the deal was $6.50 to $7.00 per share, putting the cash portion of the transaction at about $6.84 billion to $7.37 billion — depending on the number of store divested — plus the assumption of Rite Aid’s debt.