A total of 1,651 Rite Aid locations became Walgreens property as of March 2, including the Highland, New Paltz and Stone Ridge locations, and by the end of spring that number is expected to hit 1,932. Three distribution centers are also included.
The acquisition is part of the consolidation happening in this industry. Originally this was proposed to be an all-out purchase of the Rite Aid chain, but regulators put the kibosh on that in part because prices tend to rise in drug stores acquired by that corporation. The deal was originally proposed in 2015, with the rejiggered agreement being signed late last year. The $4.4 billion being paid will be used to reduce debt, and the remaining stores will be combined with the Albertsons supermarket chain to form a new company.
For the moment, the visible changes at the Rite Aid stores will be minimal. According to Walgreens spokesman Phil Caruso, they will remain “Rite Aid-branded Walgreens locations” in the short term, although customers will immediately find a Walgreens pharmacy desk inside. Employees are now on the Walgreens payroll, but the “front of store” won’t be changed before the full acquisition of Rite Aid locations is completed.
After that, “I’m not sure how long the process will take” to transition all locations to the new branding, Caruso said.
Due to the complexity of the variables, Caruso could not immediately speak to the question of insurance coverage, and whether any existing Rite Aid customers in the area might find themselves looking for a new drug supplier. “We do take a lot of insurance,” he acknowledged, but he did not have data available through which to compare those relationships with the ones current Rite Aid customers now enjoy.
Local customers who stick with Walgreens will be patronizing a company that, after this acquisition, will be the largest drug store company in the United States. That’s a new designation, with this purchase being how Walgreens outstrips CVS in terms of storefronts. Six-hundred stores will be closed, and while a list of those closures has not been released, it’s possible both the affected local locations will remain open. Closures are expected to impact stores that are within a mile of a newly-acquired location.
Regulars at the prescription counter should be receiving notification of the change, and as spring transitions to summer, the products on the retail shelves should likewise transition from Rite Aid to Walgreens-branded items. When the signs are changed, only those who never go inside and don’t read the newspaper are likely to be surprised by the news.