Rite Aid will sell stores
MONTPELIER, Vt. - At the behest of Vermont Attorney General William Sorrell, the retail drug store chain Rite Aid will sell four of its stores in the state.
The divestiture will resolve Sorrell's concerns about Rite Aid's acquisition of the U.S. assets of Jean Coutu Group, Inc. Sorrell was part of an antitrust investigation with several other states and the Federal Trade Commission.
"This settlement will preserve competition among retail drug stores in Vermont by requiring Rite Aid to sell drug stores in Vermont where the transaction might have substantially lessened competition," Sorrell said. "Consumers, particularly the uninsured, benefit from the better prices, wider choices and increased customer service that results from vigorous competition among chain drug stores."
Rite Aid announced its agreement to purchase the assets of Jean Coutu last August. Jean Coutu operates the fourth-largest drug store chain, which includes Brooks and Eckerd.
Sorrell says after the merger, the combined Rite Aid/Brooks and Eckerd chain will be the third largest drug store chain with more than 5,000 stores.
The FTC and Rite Aid agreed that the chain would sell 23 stores to competing drug store operators in Maine, Maryland, New Jersey, New York, Pennsylvania, Virginia and Vermont. Totaled, Rite Aid was ordered to sell 26 stores.
"While we are pleased to work with the FTC in ensuring Vermonters continue to enjoy the benefits of competition, we will continue to take an independent view of markets and competition in Vermont," Sorrell said.
Rite Aid has said that its acquisition of Brooks and Eckerd stores is essential to its ability to compete with larger chains CVS Corp. and Walgreen Co.
After a similar merger in 1994, Rite Aid was ordered by the FTC to pay $900,000 in civil penalties when it did not divest three stores in Maine and New Hampshire.