Shares of Fred’s surged 60 percent in early trade Monday morning after announcing This kind of will sell some pharmacy files to Walgreens for at least $165 million.
Walgreens will purchase files in addition to related pharmacy inventory of 185 Fred’s stores across 10 Southeast states. As part of the deal, Walgreens will pay $165 million, subject to adjustment, plus an amount equal to the value of related pharmacy inventory.
The companies expect to start transferring files inside fourth quarter in addition to complete the process inside first quarter of next year. Once complete, Fred’s will continue to operate about 162 pharmacies across nearly 0 stores.
“With This kind of agreement, we have taken a major step towards achieving one of our main goals of eliminating our debt balance,” said Fred’s interim CEO in addition to CFO Joe Anto.
Fred’s patients will receive letters notifying them of the transfer.
“This kind of agreement increases patient access to Walgreens pharmacies inside Southeastern U.S., in addition to allows us to introduce more people to Walgreens trusted pharmacy services in these communities,” said Walgreens President of Operations Richard Ashworth.