A bankruptcy judge on Wednesday approved Rite Aid’s pharmacy asset sales to a variety of buyers, including some of the bankrupt drugstore chain’s rivals.
Financial details were not disclosed, and sale documents redacted purchase prices for Rite Aid’s assets, which went to retail pharmacy chains like CVS and Walgreens, along with grocers Albertsons, Kroger and Giant Eagle and other buyers.
Rite Aid filed for bankruptcy for the second time in two years earlier this month, after the retail pharmacy couldn’t navigate challenges like flatlining reimbursement rates from payers, higher labor costs, lower consumer demand for frontstore merchandise and rising competition, including from disruptors like Amazon.
Judge Michael Kaplan of New Jersey’s bankruptcy court greenlit Rite Aid’s fire sale as the company looked to quickly sell its assets in a bid to make its lenders whole. Rite Aid entered bankruptcy with more than $2 billion in debt, despite exiting a previous bankruptcy in September.
The liquidation is a growth opportunity for CVS, already the nation’s largest drugstore chain with more than 9,000 pharmacies. The Woonsocket, Rhode Island-based company purchased prescription files from 625 Rite Aid stores in 15 states and fully acquired 64 brick-and-mortar Rite Aid locations in Idaho, Oregon and Washington.
The deals are still subject to regulatory approval. However, nabbing Rite Aid’s prescription files — drug dispensing records from specific pharmacies — could help CVS onboard Rite Aid’s customers to its own pharmacy locations.
In a statement Wednesday, CVS welcomed “those who may be transitioning to us from Rite Aid” if the transactions close, and also said it’s open to hiring any Rite Aid pharmacy employees who lose their jobs during the bankruptcy process.
