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BRIEF-Rite Aid to sell Walgreens Boots Alliance 2,186 Rite Aid Stores and related assets
June 29, 2017 / 11:30 AM / in 4 months

BRIEF-Rite Aid to sell Walgreens Boots Alliance 2,186 Rite Aid Stores and related assets

June 29 (Reuters) - Rite Aid Corp

* Rite Aid enters into an agreement with Walgreens Boots Alliance to sell 2,186 Rite Aid stores and related assets for $5.175 billion

* Rite Aid enters into an agreement with Walgreens Boots Alliance to sell 2,186 Rite Aid stores and related assets for $5.175 billion

* Rite Aid to receive $325 million termination fee

* ‍agreement provides rite aid with 10-year pharmaceutical purchase option through wba affiliate​

* Says ‍proceeds from deal to be used to significantly reduce debt and strengthen balance sheet​

* Expects to use substantial majority of net proceeds from transaction to repay existing indebtedness, significantly reducing co’s leverage levels

* Agreement provides rite aid with 10-year pharmaceutical purchase option through wba affiliate

* Expects to use substantial majority of net proceeds from transaction to repay existing indebtedness, significantly reducing rite aid’s leverage levels

* In light of termination of merger agreement, divestiture agreement with Fred’s Was also terminated, effective today

* Says company reported first quarter revenues of $7.8 billion, net loss of $75.3 million, or $0.07 per diluted share

* For Q1, net loss $0.07 per diluted share

* Rite Aid also expects that federal tax gain on sale of assets will be largely offset by its net operating loss carryforwards

* Says Rite Aid will continue to operate Envisionrx, its pharmacy benefit manager, Rediclinic and health dialog

* Same store sales for quarter decreased 3.9 percent over prior year

* Says same store sales for quarter decreased 3.9 percent over prior year

* Revenues for quarter were $7.8 billion compared to revenues of $8.2 billion in prior year’s q1

* In light of termination of merger agreement, divestiture agreement with Fred’s was also terminated

* Co, Walgreens Boots Alliance agree to terminate previous agreement under which Walgreens Boots Alliance was to acquire all shares of co

* Transaction to assist co in addressing “pharmacy margin challenges and allows us to significantly reduce debt”

* Q1 earnings per share view $-0.01, revenue view $8.17 billion -- Thomson Reuters I/B/E/S Source text for Eikon: Further company coverage:

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