Rite Aid.Interesting Toughts

Aug. 14, 2017 11:11 PM ETRAD1 Comment
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Contributor Since 2015


  • Is the deal already closed?
  • Why so long ?
  • Why no filing?

I was looking today on documents filed from Rite Aid in regard of their new store sales to Walgreen and what were the documents sent to FTC for review and unless i cannot read anymore, none was to be found.

This is at first really weird and tough about it for the reasons behind the fact that no document were filed since their announcement.

Here are some if's

1) Based upon their statement on the day they announced the sale they indicated that this 'will be a clear path'. Could that mean it is already approved by the FTC ?

2) If so, why no official release? Could it be because the FTC rules are in regard of the different states where Rite Aid is operating at this time and that they could have a minimal presence required to get the deal approved?

3) Could that explain why in the news release it was mentioned that the number of stores could vary a little ?

4) Could it be that at this time they are simply reviewing which stores to keep in some areas even if they already disclosed the pro forma results if results were 'after the sale' ?

5) Could it be that FTC already cleared the sale when this simple point has been corrected ?

It is hard to believe that either of those company would have gone so far in any kind of deal without prior consent from FTC and IF they were to had simply throw numbers to gain some investor confidence (no comment....) it would be a first in my recollection of more than 30 years of trading.

In my humble opinion, the deal is sealed, signed and delivered and some minor details are to be adresse before FTC gives its final clearance.

In the FTC history there is no deal that went to a second offer that have ever been rejected (please correct me if i am wrong)

Shorters: get ready to implode if news were to happen this week. You already have shorted over 110M shares (based upon july 31st stockwatch.com numbers) and in case of overnight news, there is simply no defence against that so better start to cover yourself before the storm hits you.

If before the deal was at 9$ including debt, it meant that it was a 16$ per share total (7$ of debt per share + the 9$ originally offered) and cut that in half for half the stores, it would mean that Rite Aid is now valued at 8$ per shares for the remaining of the company......

It is trading at 2,33$ meaning a possible gain of 5,67$ per share or 250% in a couple of days if the deal was to close rapidly.

Get ready and have fun.

Disclosure: I am/we are long RAD.

Additional disclosure: I am not an financial adviser and this is not intended to be a financial advise

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