CVS, REVCO IN MERGER DEAL
NEW YORK — The drugstore chains CVS and Revco have completed an agreement that combines the two companies.
Revco stock will be converted to CVS shares in a transaction valued at $2.8 billion, plus the assumption of approximately $900 million of Revco debt.
This latest in a series of consolidations among mass market retailers would also produce the largest in terms of units; a CVS/Revco merger would produce a behemoth with 4,000 locations in 24 states. Projected sales for 1997 are $13 billion, making it the second biggest in terms of volume behind Walgreen Co.
Following completion of the deal, CVS plans to embark on an aggressive expansion campaign, calling for 300 new stores or relocations per year.
The transaction, still subject to approval by both companies’ shareholders as well as by the FTC under the Hart-Scott-Rodino Antitrust Act, is expected to be completed by midyear.