November 07, 2024
Business

Rite Aid acquires Brooks stores

Rite Aid Corp. announced Monday that it has acquired five Brooks stores in Maine – including one each in Bangor and Brewer – as it becomes the largest drugstore chain on the East Coast and the third-largest in the nation.

Rite Aid followed up on its August announcement that it would purchase the U.S. Eckerd and Brooks operations of Canada’s Jean Coutu Group Inc. for about $2.55 billion in cash and stock. In the end, Rite Aid acquired 1,854 Brooks and Eckerd stores and six distribution centers in 18 East Coast and mid-Atlantic states.

Soon Rite Aid, based in Camp Hill, Pa., will operate 5,000 stores in 31 states and the District of Columbia, including 83 stores in Maine. There were no Eckerd stores in Maine for Rite Aid to acquire.

“This is a very exciting day for Rite Aid, and we are fortunate to have the talented Brooks associates who work in Maine joining our team,” Mary Sammons, Rite Aid chairman, president and CEO, said in a prepared statement Monday. “We look forward to enhancing the shopping experience at our new stores by bringing the additional products, services and benefits Rite Aid offers.”

Federal and state regulators required Rite Aid to divest 26 stores, all in East Coast states, a number that was smaller than Rite Aid originally expected.

Rite Aid initially acquired Brooks stores in Bangor, Brewer, Waterville, Gardiner, Freeport and Kittery, but the Federal Trade Commission required it to sell the Brooks store in Gardiner to allow for fair market competition, Rite Aid spokeswoman Jody Cook said in an interview Monday. Rite Aid sold the store to The Medicine Shoppe, Cook said.

Maine Attorney General Steven Rowe applauded what his office termed the FTC’s “cooperative approach” to the investigation of Rite Aid’s acquisition plans in Maine.

“It is a partnership,” he said. “The FTC provides important resources; our office provides the knowledge of local markets.”

Stores that are very close to one another, such as the Brooks and Rite Aid stores on Union Street in Bangor, will be evaluated and one store may be closed, Cook said. Fewer than 200 of the newly acquired 1,854 stores will close, she said.

Rite Aid intends to offer jobs at the store that is retained or at a nearby Rite Aid store to employees affected by a closure, she said.

“We absolutely intend to retain all associates,” Cook said.

If a store is closed, the drug prescriptions on file will transfer to the store that remains open, Cook said.

Brooks and Eckerd stores will be integrated into Rite Aid in phases, including the installation of Rite Aid technology and a minor remodeling, including upgraded decor and remerchandising. All stores are expected to be converted and re-branded Rite Aid over the next 16 months.

Over the next several years, Rite Aid plans to spend $1 billion to fully remodel almost all of the Brooks and Eckerd stores. The company will also continue its new store development program with plans to open nearly 1,000 new and relocated stores over the next five years.

Rite Aid said that among the changes customers would start to see shortly in the former Brooks stores will be more nonpharmacy items for sale, including an inexpensive Rite Aid private brand. In the next few months, customers ages 60 and above will also be able to sign up for Rite Aid’s Living More senior loyalty program, which provides special health and wellness benefits and discounts for seniors.

With the now-completed acquisition of Brooks and Eckerd, Rite Aid has annual revenues of more than $27 billion. The company is publicly traded on the New York Stock Exchange under the symbol RAD.

Shares of Rite Aid closed up 19 cents at $6.55 in trading Monday.

The Associated Press contributed to this report.


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