Walgreens could close 1,000 stores

Walgreens Boots Alliance (NASDAQ:WBA) is willing to sell or close up to 1,000 locations as it seeks to win regulatory approval of its deal to acquire drugstore chain Rite Aid.  

The retailer said last week that it would acquire Rite Aid in a deal worth $17.2 billion, joining the No. 1 and No. 3 drugstore chains. The merger could face stiff opposition from the Federal Trade Commission as members seek to promote competition in the health care market and block Walgreens from achieving greater leverage with insurers and benefit managers.

But Walgreens contends otherwise. CEO Stefano Pessina said on a conference call Wednesday that the Rite Aid merger wasn't about increasing negotiation power, Chicago Tribune reported. The retailer backed up its statement by releasing a new study, the results of which show that pharmacy interventions significantly reduce care costs and improve outcomes.

The study, "Improving Medication Adherence and Healthcare Outcomes in a Commercial Population Through a Retail Pharmacy Chain," showed that a patient could achieve a six-month cost savings of up to $164 by using pharmacy services while also reducing emergency room and hospital visits.

While the company said it had done a thorough antitrust analysis before announcing the merger, Walgreens said it would consider unloading up to 1,000 stores to get the deal done, according to a securities filing.

For more:
-See this Chicago Tribune article (subscription)
-See the Walgreens press release

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