Walgreens to Acquire Kerr Drug's Retail Drugstores and Specialty Pharmacy Business
DEERFIELD, Ill. & RALEIGH, N.C., September 10, 2013 - Walgreen Co. (NYSE: WAG) (NASDAQ: WAG) and Kerr Drug, a privately held regional pharmacy chain in North Carolina, announced today that they have entered into a definitive agreement under which Walgreens would acquire certain assets of Kerr Drug’s retail drugstores and specialty pharmacy business. Financial terms of the agreement were not disclosed. In fiscal year 2012, Kerr Drug’s retail drugstores and specialty pharmacy business recorded total sales of $381 million.
The acquisition advances Walgreens strategy to deliver the Well Experience for customers by expanding Walgreens presence in North Carolina, a fast-growing market, including into many smaller communities. Kerr Drug’s standard of innovation and excellence in pharmacy service also aligns well with Walgreens strategy to transform the role community pharmacy plays in health care.
“The Kerr Drug retail drugstores and specialty pharmacy business are an exceptional addition to the Walgreens family of companies,” said Walgreens President and CEO Greg Wasson. “We are closely aligned on the important task of expanding the health care role that community pharmacists can have with their patients, and we share the common goal of stepping out of the traditional drugstore format to create a new experience for our customers.”
Kerr Drug Chairman, President and CEO Anthony Civello said, “Kerr Drug’s strategy and core principles have always been focused on its unique ability to provide patients access to the most comprehensive and convenient health and wellness offering in the industry. Walgreens is the perfect partner to continue this journey as a patient-oriented company dedicated to expanding the role of the pharmacist as an integral part of health care.”
The acquisition is structured as an asset transaction and includes Kerr Drug’s 76 retail drugstores and its specialty pharmacy business. The acquisition also includes a distribution center. Kerr Drug will retain ownership of its long-term care pharmacy business.
The transaction is subject to satisfaction of regulatory requirements and other conditions, and is expected to close sometime this year. Walgreens anticipates the transaction will not have a material impact on earnings per share in fiscal year 2014.
Until the acquisition closes, Kerr Drug and Walgreens will continue to operate separately. After closing, the acquired Kerr Drug retail drugstores will continue to operate under their current brand in the near term. Decisions will be made over time regarding the best, most effective way to integrate Kerr Drug’s retail drugstores and specialty pharmacy business with Walgreens operations.