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Валгрин Ко. Message Board

  • hcl815 hcl815 Oct 7, 2013 3:41 PM Flag

    2 possibilities..........wag will buy rite-aid, or wmt will????

    pretty cheap for all those locations

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    • If WAG were interested in acquiring RAD they would have done so while the stock was languishing under $1. Today, RAD is overpriced over the excitement surrounding their temporary return to profitability. The current profitability of RAD is primarily due to a slew of branded drug patent expirations and the huge profits to be had over the first year or two of generic marketing. WAG and CVS are taking market share from RAD consistently, why buy it? The other issue is federal approval of a takeover of this size. WAG is already the largest pharmacy retailer and RAD is number 3. WAG would be forced to divest of many of the stores if they were able to get approval at all. Also to buy RAD is to assume $6B of debt. WAG is using their cash flow and borrowing power to purchase Boots. That process will be completed in 2015 when they purchase the other 55% of the company. WAG is also taking a position in Amerisource Bergen, further committing their available cash & borrowing.