SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): April 24, 1996
RITE AID CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-5742 23-1614034
(State or other jurisdiction (Commission File (IRS Employer of
incorporation or organization) Number) Identification No.)
30 Hunter Lane, Camp Hill, PA 17011
(Address of principal executive offices)
Registrant's telephone number, including area code:
(717) 761-2633
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
ITEM 5. OTHER EVENTS.
On April 24, 1996, Rite Aid Corporation (the "Registrant") issued a
press release which announced, among other things, that the Registrant and
its wholly owned subsidiary, Ocean Acquisition Corporation (the
"Purchaser"), have terminated the Purchaser's offer to purchase 35,144,833
shares of common stock, par value $.01 per share (the "Shares"), of Revco
D.S., Inc., ("Revco"), at a price of $27.50 per Share. A copy of the press
release is filed herewith as Exhibit 99.1 and is incorporated herein by
reference.
On April 25, 1996, the Registrant, the Purchaser and Revco terminated
the Agreement and Plan of Merger, dated as of November 29, 1995, by and
among the Registrant, the Purchaser and Revco.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION
AND EXHIBITS.
(a) Financial Statements of the Businesses Acquired.
Not Applicable.
(b) Pro Forma Financial Information.
Not Applicable.
(c) Exhibits:
Ex. No. Description
99.1. Text of Press Release, dated April 24, 1996,
issued by the Registrant.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
RITE AID CORPORATION
Date: April 29, 1996 By: /s/ Elliot S. Gerson
----------------------
Elliot S. Gerson
Senior Vice President
EXHIBIT INDEX
Ex. No. Description
99.1. Text of Press Release, dated April 24, 1996,
issued by the Registrant.
(RITE AID
CORPORATION - LOGO)
Contacts:
Media:
Suzanne Mead
VP Corporate Communications
(717) 975-5887
Investors:
Frank Bergonzi
Executive VP and CFO
(717) 975-5750
FOR IMMEDIATE RELEASE
RITE AID CORPORATION WITHDRAWS TENDER OFFER FOR
REVCO D.S., INC.
CAMP HILL, PA, April 24, 1996 -- Rite Aid Corporation (RAD:
NYSE, PSE) announced today that it has withdrawn its tender offer for Revco
D.S., Inc. The following is a statement from Rite Aid Chairman and Chief
Executive Officer Martin Grass:
"It is apparent to us that the Federal Trade Commission (FTC)
has never been interested in reviewing the facts surrounding our intended
merger with Revco in an impartial manner. Despite the facts presented that
proved this transaction would be pro-consumer, the FTC kept changing the
rules of the negotiation.
"When Rite Aid made an offer which totally responded to all of
the Staff's demands, the bar was raised in such a way as to make it
impossible for us to clear it. When state negotiations were progressing,
the FTC interfered to dissuade certain states from settling before the
federal government.
"It is ironic that the Clinton administration, which had pushed
hard early in its administration for competition in the drug provider
channel, has now bowed to the potential interests of some of the large
prescription drug manufacturers. Any careful analysis of this acquisition,
compared to all previous drugstore acquisitions, would have led to the
conclusion that Rite Aid would have to divest 50 stores, not the 340 stores
Rite Aid offered to sell in its most recent proposal to the FTC on Monday.
"Rite Aid previously had gained approval from the United States
Department of Justice to acquire Revco in 1991. At that time, Revco had
positive cash flow and was emerging from bankruptcy and was viewed as a
profitable company.
"In addition, last year, the issue of undue influence on
pharmacy benefit managers (PBMs) was carefully reviewed by the FTC in the
acquisition of Brooks Drug in Maine by Rite Aid. Rite Aid was given a green
light on the state-wide PBM Issue. The situation in Maine was a mirror
image of the proposed Revco transaction. Interestingly, arguments that were
successfully used by the top FTC lawyer when he represented a competitor of
Rite Aid two years ago in private practice, before joining the Commission,
were entirely disregarded. Curiously, he did not recuse himself from this
case as his superior did who had previously worked for Rite Aid.
"Drugstore consolidations like the proposed Rite Aid/Revco
combination are fraught with peril for any drugstore retailer that desires
to grow via acquisition. This is especially true if the planned purchase
includes the combination of any two drugstore chains operating in the
same state. In our opinion, the future for drugstore acquisitions by chains
is very uncertain. This case has introduced unheard of concepts in the
application of anti-trust law. In addition, in the eyes of the FTC, the
more than 25,000 independent drugstores competing every day in the United
States are a non-entity in the retail distribution of pharmaceuticals. This
viewpoint can only lead to a gloomy future for these retailers when matters
concerning them are reviewed by the FTC.
"In the middle of the negotiations, the FTC issued a press
release admonishing Rite Aid for not having divested two stores obtained in
Maine from the Brooks Drug acquisition. It is interesting to note that the
Maine Attorney General did not require these stores to be sold because his
knowledge of the market led him to believe there were no competitive
problems with that proposed merger. Interestingly, the FTC's hand-picked
trustee has been trying to sell these stores for the last three months to
no avail.
"Unfortunately, because of the April 29 expiration date of the
contract, Rite Aid has determined it was not feasible to litigate this
matter with the FTC. In the future, it is our intention to aggressively
challenge the flawed FTC concepts in a court of law."
Rite Aid Corporation, based in Camp Hill, Pennsylvania, is the
nation's largest drugstore chain, with over 2,700 stores in 21 states and
the District of Columbia.
General information about Rite Aid including corporate
background and press releases is available, free of charge, through the
company's News-On-Demand fax service at (800) 916-7788.
