Walgreen Continues Acquisitions

11 Jul

Walgreen Co. announced Thursday that it had agreed to buy 144 drugstores from Stephen L. LaFrance Holdings, Inc. and members of the LaFrance family for $438 million.

Based in Deerfield, Illinois, Walgreen seems determined to grow through acquisition rather than organic, same-store sales in order to get more business. In fact, same store sales have continued to decline. The sales decline over the last year is attributable, in large part, to a failure to come to terms with Express Scripts Holding Co., a PBM (Pharmacy Benefits Manager).

The purchase includes USA Drug, Super D Drug, May’s Drug, Med-X and Drug Warehouse brands. The companies have stores in Arkansas, Kansas, Mississippi, Missouri, New Jersey, Oklahoma and Tennessee. According to President and CEO Greg Wasson, “the purchase will provide significant new pharmacy business” to Walgreen in the mid-south and rural communities.

This marks the second acquisition announced in the last three weeks. Two weeks ago, Walgreen said it would pay $6.7 billion for a 45 percent share of Alliance Boots GmbH, a European health and beauty retailer. Walgreen also said it has the option to purchase the rest of the company, an option it said it will exercise in the next three years.

In 2010, Walgreen bought New York pharmacy chain, Duane Reade and last year purchased Drugstore.com for $429 million.

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