Earlier this year, plans of Walgreens’ acquisition over Rite Aid have started to take place and the effects have begun right here in Newark.
As people’s lives become more hectic, they highly depend on the convenience of stopping by at a local drugstore to pick up daily needs. Whether to pick up medication from the pharmacy, photos, beauty products, or even snacks, these drug stores have it all. Over the past couple years, the top three leading companies that provided these services have been, consecutively, Walgreens, CVS, and Rite Aid.
On October 2015, Walgreens had made plans to buy out Rite Aid in hopes to expand their pharmaceutical market and become the largest drug store company, followed by CVS. As of July 2016, the Walgreens Boots Alliance’s CEO, Stefano Pessina, has revealed to stockholders that the plan of merging Walgreens and Rite Aid will be complete by the end of 2016.
Since then, the Federal Trace Commission has closely looked over their stocks, especially after Brexit, and in the past couple months, there has been speculation that the $17.2 billion acquisition may be approved after all. In order for to progress with government approval, however, Walgreens must sell out between 500-1,000 stores, possibly to third party companies. With the advice from the Federal Trade Commission, they recommended to sell out stores where Rite Aid and Walgreens are within the same vicinity. Walgreens have slowly started to begin this process by auctioning off certain stores around the US, including the Rite Aid just a few blocks away from NJIT.
So, what will this mean for the daily consumer? Well, if you’ve been an avid shopper at Rite Aid, you’ll begin to notice the effects immediately. Right here in Newark, the Rite Aid on 111 Market St. has already shut down, with probably many more to follow. For those of you who have been loyal customers to the Rite Aid on Market St., there is another store on 1084 Broad St.
Consumers do hope the merger goes as successfully as portrayed with the information given out by the companies. The deal could benefit the companies and the consumers due to the fact that the companies will both share a large market and there will probably more options available when buying prescription medication and possibly at a lower price. Due to years of reliable service for our daily needs, there is much hope that the Walgreen’s acquisition of Rite Aid will be a successful business move.