Walgreens to Acquire Kerr Drug’s Retail Drugstores and Specialty Pharmacy Business
September 10 2013 - 8:10AM
Business Wire
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.
About Walgreens
As the nation's largest drugstore chain with fiscal 2012 sales
of $72 billion, Walgreens (www.walgreens.com) vision is to become
America’s first choice for health and daily living. Each day,
Walgreens provides more than 6 million customers the most
convenient, multichannel access to consumer goods and services and
trusted, cost-effective pharmacy, health and wellness services and
advice in communities across America. Walgreens scope of pharmacy
services includes retail, specialty, infusion, medical facility and
mail service, along with respiratory services. These services
improve health outcomes and lower costs for payers including
employers, managed care organizations, health systems, pharmacy
benefit managers and the public sector. The company operates 8,117
drugstores in all 50 states, the District of Columbia and Puerto
Rico. Take Care Health Systems is a Walgreens subsidiary that is
the largest and most comprehensive manager of worksite health and
wellness centers and in-store convenient care clinics, with more
than 700 locations throughout the country.
About Kerr Drug
Kerr Drug was founded by pharmacist Banks Kerr in 1951 and for
the past 62 years has served the customers of North Carolina. Kerr
Drug is one of the most recognized and respected names in the chain
drug industry. With its roots in the Carolinas and headquarters in
Raleigh, N.C., Kerr Drug’s strategic direction is founded in its
unique ability to provide patients, the medical community and
health plans access to the most comprehensive and convenient health
and wellness offering in the industry. With a mission to be the
most comprehensive provider of pharmacy and related health care
services, while continuing to be the most reliable provider of
health-related and convenience items, Kerr Drug is currently
providing services that far exceed the traditional drugstore
mix.
Cautionary Note Regarding Forward-looking
Statements: Statements in this press release that are not
historical are forward-looking statements made pursuant to the safe
harbor provisions of the Private Securities Litigation Reform Act
of 1995. Words such as “expect,” “likely,” “outlook,” “forecast,”
“would,” “could,” “should,” “can,” “will,” “project,” “intend,”
“plan,” “continue,” “sustain,” “synergy,” ”on track,” “believe,”
“seek,” “estimate,” “anticipate,” “may,” ”possible,” “assume,”
variations of such words and similar expressions are intended to
identify such forward-looking statements. These statements are not
guarantees of future performance and are subject to risks,
uncertainties and assumptions that could cause actual results to
vary materially from those indicated, including: the ability to
satisfy the closing conditions and consummate the proposed
transactions on a timely basis or at all, the ability to
successfully integrate the acquired business, the ability to
realize anticipated synergies, the ability to achieve anticipated
financial results, changes in vendor, payer and customer
relationships and terms, and other factors described in Item 1A
(Risk Factors) of Walgreens most recent Annual Report on Form 10-K
and Quarterly Report on Form 10-Q, each of which is incorporated
herein by reference and in other documents that Walgreens files or
furnishes with the Securities and Exchange Commission. Should one
or more of these risks or uncertainties materialize, or should
underlying assumptions prove incorrect, actual results may vary
materially from those indicated or anticipated by such
forward-looking statements. Accordingly, you are cautioned not to
place undue reliance on these forward-looking statements, which
speak only as of the date they are made. Except to the extent
required by law, Walgreens does not undertake, and expressly
disclaims, any duty or obligation to update publicly any
forward-looking statement after the date of this report, whether as
a result of new information, future events, changes in assumptions
or otherwise.
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