Rite Aid is growing its presence in the greater Seattle area.
Rite Aid has entered into a definitive agreement to acquire Bartell Drugs for $95 million. The 130-year-old, family-owned Bartell generates more than $550 million in revenue and operates 67 stores in Seattle and three counties in Washington State.
Bartell’s stores will join Rite Aid's existing 69 Seattle area stores and will continue to operate under the Bartell Drugs name.
“The acquisition of Bartell's fits perfectly into and accelerates our RxEvolution strategy, as our companies share a commitment to total health and wellness, the importance of the pharmacist as a trusted health advisor and the critical role the neighborhood pharmacy plays,” stated Heyward Donigan, president and CEO, Rite Aid, which has more than 2,400 locations across 18 states. “Expansion within the growing Seattle area will allow Rite Aid to better serve customers, health plans and healthcare providers."
Added George D. Bartell, chairman of Bartell Drug: "Looking forward to the future with Rite Aid, we are excited about the opportunity to expand upon our mission to be the best neighborhood drug store in the Pacific Northwest. Rite Aid's vision fits well with what we think will best serve the needs of our customers. This is a day to celebrate the 130-year success story of Bartell Drugs, while eagerly anticipating the future."
The transaction is expected to be accretive to Rite Aid's adjusted earnings per share after the first 12 months following the closing of the transaction, which is expected by the end of Rite Aid's 2021 fiscal year, subject to regulatory approvals and other customary closing conditions.
The company also has updated its fiscal 2021 guidance for capital expenditures and free cash flow, with the former now expected to be between $300 million and $325 million, and the former expected to sit between $60 million and $135 million.
Moelis & Company acted as Rite Aid's financial advisor and Troutman Pepper and Morgan Lewis acted as legal advisors in connection with this transaction.