FTC not sold on Walgreens' plan to win nod for Rite Aid deal: Bloomberg

The U.S. Federal Trade Commission is not satisfied with Walgreens Boots Alliance Inc’s (WBA.O) plan to divest stores to win antitrust clearance for its acquisition of Rite Aid Corp (RAD.N), Bloomberg reported, citing people familiar with the matter.

The FTC isn’t convinced that Walgreen’s proposal to sell 865 drugstores to Fred’s Inc (FRED.O) would do enough to preserve competition that would be lost in the $9.4 billion tie-up, Bloomberg reported on Friday. (bloom.bg/2iJXpwf)

The FTC is also unlikely to complete its review of the deal before the deadline of Jan. 27 to close the transaction, Bloomberg reported.

Walgreens will have to pay Rite Aid a termination fee of $325 million if the FTC blocks the deal.

Walgreens declined to comment. Rite Aid, Fred’s and the FTC could not be immediately reached for comment.

Walgreens shares were down 2 percent in heavy trading. Rite Aid shares tumbled about 14 percent and Fred’s shares fell 5.8 percent.

(Reporting by Abhijith Ganapavaram in Bengaluru; Editing by Savio D’Souza)