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DEERFIELD, Ill. -- The nation's largest drug chain, Walgreen Co. based here, plans to get bigger, by acquiring the Delaware-based Happy Harry's pharmacy chain, with 76 Happy Harry's stores in Delaware, Pennsylvania, Maryland and New Jersey.
Walgreen, already the nation's largest U.S. drugstore chain, would also get the corporate office and distribution center in Newark, Del. Financial terms of the agreement weren't disclosed.
The merger -- which represents Walgreens' largest acquisition since 1986, when it purchased the 66-store Medi Mart chain in the Northeast -- is subject to regulatory approval. It is expected to close this summer.
"Retail acquisitions are rare for us, but Happy Harry's presented a unique opportunity and is a solid strategic fit," said Walgreen's chairman and c.e.o. Dave Bernauer. "Happy Harry's is one of the strongest regional chains in the drugstore industry, with a great following in a market where we have little presence. Its brand reputation and market share are a great base from which to build our presence there. These stores are performing well and will benefit us right from the start."
Happy Harry's c.e.o. Alan Levin, whose father Harry founded the company in 1962, will continue working with Walgreen after the deal closes. Said Levin: "My father would be proud of the accomplishments we've made and very pleased with [the] announcement. He always believed, as do I, in putting our customers and employees first, and so does Walgreens."
Over the last 10 years, Walgreens has opened more than 3,800 locations, while acquiring fewer than 30 retail drugstores.
Frank Grilli, Walgreens v.p. of store operations, will lead the integration of the new stores. "We plan to keep the name and look of the stores the same, while over time evaluating the benefits of incorporating or substituting the Walgreens name," said Grilli, adding that the only exceptions are the eight stores in Pennsylvania, where the decision has already been made to convert the stores to the Walgreens name because of our stronger branding there."
After the transaction closes, Walgreens said it expects to continue accepting all prescription insurance plans currently taken by Happy Harry's.
With fiscal 2005 sales of $42.2 billion, Walgreens operates 5,251 stores in 45 states and Puerto Rico.