Walgreens Boots Alliance Inc. agreed to acquire Rite Aid Corp. for $9.42 billion in cash in a transaction to further expand the company’s role in the distribution of medications in the U.S.
The transaction will add to Walgreens’ earnings after the deal has been complete for a full year, the companies said Tuesday in a statement. Including debt, the deal is valued at $17.2 billion, they said.
Rite Aid shares closed up more than 42 percent Tuesday to $8.67 after the Wall Street Journal reported the companies were close to a deal. In after-hours trading, they fell more than 7 percent to $8, reflecting speculation that the deal will face antitrust scrutiny.
The stock had slumped 29 percent since Sept. 16 after the company lowered profit and revenue forecasts for the year, giving Walgreens a potential opportunity to make an offer.
A potential deal comes after several waves of consolidation that have reshaped the pharmacy industry. Since 2010, Walgreens has acquired Duane Reade, USA Drugs and Kerr Drug, helping it grow to more than 8,200 stores and revenue of $76 billion last year.
Last year, Walgreens struck a complicated deal to buy Alliance Boots, a British pharmacy chain, to gain a foothold in Europe. Buying Rite Aid would give it an additional 4,600 stores in 31 states, adding to its roughly 8,200 locations across the country, Puerto Rico and the Virgin Islands.
The biggest drugstore chain, CVS Health, has also grown, and now runs more than 7,800 stores.
Rite Aid, which itself acquired the Brooks and Eckerd pharmacy chains in 2007, has fallen to a distant third. Camp Hill, Pa.-based Rite Aid and Deefield, Ill.-based Walgreens both have a Charlotte presence.
The New York Times contributed.