DEERFIELD, Ill. -- Walgreens will close about 600 stores across the United States following its acquisition of a majority of Rite Aid Corp.'s drug stores.
Walgreens Boots Alliance Inc. received regulatory approval in September to purchase 1,932 stores, three distribution centers and related inventory from Rite Aid Corp., Camp Hill, Pa., for $4.375 billion in cash and other consideration.
Walgreens said it will close nearly 600 of those stores because they overlap with another Rite Aid or Walgreens location, according to multiple reports.
“The vast majority being closed are within 1 mile of another drugstore that we own going forward,” Alexander Gourlay, Walgreens' co-chief operating officer, told analysts Oct. 26. The closings will take about a year and a half and begin soon after the deal closes, Fortune reported. The closing is expected by spring 2018.
Walgreens expects to pay about $500 million in additional capital spending to convert the stores it is buying and keeping.
Walgreens Boots Alliance, Deerfield, Ill., is a global, pharmacy-led health and well-being enterprise created through the combination of Walgreens and Alliance Boots in December 2014, bringing together two companies with complementary geographic footprints. It has more than 13,200 stores in 11 countries. The company's portfolio of retail and business brands includes Walgreens, Duane Reade, Boots and Alliance Healthcare, as well as health and beauty product brands such as No7, Botanics, Liz Earle and Soap & Glory.
Rite Aid operates more than 4,500 drug stores in 31 states and the District of Columbia with fiscal 2017 annual revenues of $32.8 billion.
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