Responding to regulators' antitrust concerns, Walgreens and Rite Aid pared their deal for a full acquisition, scaling back to an agreement for Walgreens to buy only half of Rite Aid's stores.
Originally, Walgreens was to acquire the majority of Rite Aid's 4,500 stores, with the remainder being sold to a smaller competitor, Fred's. Under the revised terms, Walgreens will acquire roughly 2,200 stores Rite Aid locations. The rest continue under the Rite Aid brand.
The revised deal doesn't remake the drugstore sector so much as underscore the dominance of its two biggest players, Walgreens and rival CVS. Walgreens has roughly 8,000 locations in the US; after the deal that total will top 10,000. CVS meanwhile has more than 9,500, including some 1,500 pharmacies inside Target stores.
Rite Aid, already dwarfed by the giants, will be even smaller by comparison with its reduced footprint post acquisition.
Here's how the top 3 rank in two key measures, sales per square foot and same store sales grwoth. Data is drawn from the eMarketer Retail & Ecommerce database.
Average Sales per Square Foot
1) CVS - $894
2) Walgreens - $720
3) Rite Aid - $460
Same Store Sales Growth
1) Walgreens - 3.8%
2) CVS - 1.9%
3) Rite Aid - 1.3%