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CVS selling 120 stores
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May 30, 1997: 6:25 p.m. ET
Drugstore chain will shed outlets to satisfy agreement with FTC
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NEW YORK (CNNfn) - CVS Corp. on Friday said it will sell 120 Revco D.S. Inc. drugstores as part of a $2.8 billion merger approved by the Federal Trade Commission.
The FTC required CVS to sell the stores as part of its approval of the merger.
CVS will sell 114 stores in the Richmond and Tidewater areas of Virginia to Eckerd Corp., a division of JC Penney. CVS will sell assets of six other stores in Binghampton, N.Y. to Medicine Shoppe International. CVS didn't release terms of the sales.
Under the deal's terms, announced today, investors will receive .8842 CVS shares for each Revco issue held. CVS shares closed Friday on the New York Stock Exchange at 47-5/8, meaning each Revco share is worth about $42.11.
The merger creates the nation's second-largest drugstore chain, with $13 billion in revenues and nearly 4,000 stores. CVS will assume $900 million of Revco's debt as part of the acquisition.
"We are very excited to complete this merger, which brings together two industry leaders and will provide new opportunities for CVS to accelerate its growth," said Stanley P. Goldstein, chairman and CEO of CVS, in a statement.
CVS plans to close Revco's headquarters in Twinsburg, Ohio, by the end of the year, said Nancy Christal, vice president of investor relations. The move puts 1,000 jobs at risk. The company on Friday didn't release more details about the likelihood of layoffs.
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CVS
Revco
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