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Last week’s news that privately held Albertsons Companies, one of the nation’s largest grocery retailers, would merge with publicly traded Rite Aid Corporation, one of the country’s leading drugstore chains, will have a major impact on Rite Aid’s future.
Ashley Flower, Senior Manager of Public Relations at Rite Aid, told Loyalty360 that the deal provides a “transformative opportunity” for Rite Aid.
“It takes us from being a strong regional pharmacy player and combines us with the No. 2 grocer in the country to create the differentiated leader in food, health, and wellness,” Flower said. “The combined platform positions Rite Aid to capitalize on our pharmacy expertise and will give us a significantly increased geographic presence, which will provide greater density, convenience, and format choice for our customers.”
As a result of the merger, the integrated company will operate approximately 4,900 locations, 4,350 pharmacy counters, and 320 clinics in 38 states. The Albertsons pharmacies will be rebranded under the Rite Aid name.
“It will also provide multiple new levers for growth, by bringing new customers, helping us transform the front-end of our stores, and providing access to new, attractive markets,” Flower explained. “The combination will also solidify our financial profile, with strong cash flow generation to fund future investment in the business, more diversified revenue and profit streams, and substantial synergy opportunities. Together, the increase in scale, new growth levers, and an enhanced financial profile, will create compelling value for our customers and our shareholders.”
Current Rite Aid Chairman and Chief Executive Officer John Standley will become Chief Executive Officer of the combined company, with current Albertsons Companies Chairman and Chief Executive Officer Bob Miller serving as Chairman. The combined company is expected to be comprised of leadership from both companies and will be dual headquartered in Boise, Idaho, and Camp Hill, Penn.
“The proposed combination with Albertsons Companies provides us with an excellent opportunity to be part of a leading food, health, and wellness company with expanded capabilities to serve customers where, when, and how they want to shop,” Flower said. “The combined company will have a world-class, omnichannel platform with unique combination of formats, brands, offerings and channels, which will allow us to meet our customers where and how they want to shop. Customers will have a wide array of ways to access their food and pharmacy needs. For example, our alliance with Instacart and our Drive Up and Go offerings allow our customers to shop online and arrange delivery or curbside pickup on their schedule. And of course, we will continue to use to offer different shopping formats, including combined supermarkets and pharmacies and standalone pharmacies.”
Flower said that Rite Aid’s award–winning, highly popular wellness+ loyalty program will continue to be a part of the company’s ongoing business.
“Following the completion of the merger, we will get even closer to our customers by applying enhanced data analytics capabilities to a combined base of 25 million active loyalty program members, to drive traffic across the combined company, make real-time personal connections with our customers, and create localized and personalized marketing and merchandising strategies driven by new customer insights.”
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