Walgreens to buy Fred's pharmacy files for $165M

Walgreens said today that it will acquire pharmacy patient prescription files and related pharmacy inventory of 185 Fred's stores located across 10 Southeastern states.

Under the agreement, the aggregate consideration to be paid by Walgreens to Fred's is $165 million, subject to adjustment, plus an amount equal to the value of related pharmacy inventory.

"This agreement increases patient access to Walgreens pharmacies in the Southeastern U.S., and allows us to introduce more people to Walgreens trusted pharmacy services in these communities. We look forward to welcoming Fred's patients and team members who are hired into available Walgreens positions," said Richard Ashworth, Walgreens president of operations.

The transaction is part of a previously announced plan by Fred's to unlock shareholder value by monetizing noncore assets through strategic transactions. Fred's will continue to operate its retail stores at most of these locations after the pharmacies close. Once the transaction is complete, Fred's will continue to operate approximately 162 pharmacies across nearly 600 stores. Fred's pharmacy staff at the closing locations will have an opportunity to apply for any available positions at Walgreens.

"With this agreement, we have taken a major step toward achieving one of our main goals of eliminating our debt balance," said Joe Anto, interim CEO and CFO of Fred's. "We look forward to partnering with Walgreens to transition our pharmacy patients in these locations as smoothly as possible."