Walgreen Co. announced Thursday (July 5) that it has entered into an agreement to purchase USA Drug Stores, a regional drugstore chain in the mid-South owned by Stephen L. LaFrance Holdings, Inc. and members of the LaFrance family.
The transaction includes 144 stores currently operated under the USA Drug, Super D Drug, May's Drug, Med-X and Drug Warehouse stores located in Arkansas, Kansas, Mississippi, Missouri, New Jersey, Oklahoma and Tennessee.
The acquisition also includes corporate offices, a distribution center located in Pine Bluff, and a wholesale and private brand business, for a total of approximately $438 million.
The chain recorded sales of $825 million in 2011.
“This acquisition expands our business in an important region of the country,” said Walgreens President and CEO Greg Wasson. “It will provide significant new pharmacy business for us in this region while also enabling us to bring the Walgreens experience to many additional smaller communities where USA Drug has developed strong operational expertise.”
The transaction is subject to satisfaction of regulatory requirements and other closing conditions, and is expected to close around Sept. 1, 2012.
“What is now USA Drug began from a single store I opened in Pine Bluff, Ark., in 1968 and has grown to more than 140 stores in seven states,” said Stephen L. LaFrance, Chairman
and Owner of Stephen L. LaFrance Holdings, Inc. “We chose to sell our business to Walgreens not only because it is the premier drugstore company in our industry, but also because Walgreens will continue to provide our customers with the service and products they have come to expect.”
LaFrance added, “I have loved every minute of my career these past 44 years, beginning as a pharmacist, then management and currently as owner and chairman. From the bottom of my heart, I would like to thank everyone who has been a part of my success: from my vendors, bankers, partners, employees, family and most importantly to my customers. I want to thank all of them for placing so much trust and faith in me. Without them, none of what I have accomplished would have been possible.”
The transaction is structured as a purchase of the stock of Stephen L. LaFrance Holdings, Inc., which owns most of the acquired business, and also includes the purchase of assets or stock of certain affiliated companies or stores and other parts of the business that are not owned by that holding company.
The acquired drugstores will continue in the near term to operate under their current brand names after the transaction closes, and decisions will be made over time regarding the best, most effective way to harmonize Walgreens and the acquired brands, according to a statement from both companies.