By Lisa Kerner
Charlotte, N.C., Aug. 12 - CVS Caremark Corp. and Longs Drug Stores Corp. agreed to combine in a transaction valued at $2.9 billion including debt.
Under the companies' definitive agreement, CVS Caremark will acquire Longs, a Walnut, Calif., drugstore chain, for $71.50 per share, a CVS Caremark news release said.
CVS Caremark will acquire Longs' 521 retail drugstores in California, Hawaii, Nevada and Arizona as well as its Rx America subsidiary, which offers prescription benefits management and prescription drug plan benefits.
Longs chairman, president and chief executive officer Warren F. Bryant said given the changing industry landscape, the merger is the "logical next step" for the company.
CVS Caremark will fund the acquisition with a $1.5 billion bridge loan facility and existing cash and liquidity.
The companies expect to close the merger in the fourth quarter.
Following the acquisition, CVS Caremark, based in Woonsocket, R.I., will fill or manage more than 1.2 billion prescriptions per year and will operate about 6,800 drugstores in 41 states and the District of Columbia.
CVS Caremark was advised by Lehman Brothers and Deutsche Bank, while J.P. Morgan Securities Inc. advised Longs.
| Acquirer: | CVS Caremark Corp.
|
| Target: | Longs Drug Stores Corp.
|
| Announcement date: | Aug. 12
|
| Transaction total: | $2.9 billion
|
| Price per share: | $71.50
|
| Expected closing: | Fourth quarter of 2008
|
| Stock price for target: | NYSE: LDG: $55.11 on Aug. 11
|
© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere.
For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.
