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DEERFIELD, Ill. — Following a pattern of augmenting its presence in important markets through the acquisition of strong regional drug chains, Walgreen Co. has agreed to purchase the pharmacy business and other assets of 25 Snyders Drug Stores locations in Minnesota.
Financial terms of the transaction between the nation’s biggest drug chain and St. Louis Park, Minn.-based Snyders, a Katz Group subsidiary, were not disclosed.
The 25 pharmacies that operate as Snyders franchisees are independently owned and are not part of the deal.
In a statement, Walgreens indicates that it will continue to operate some of the Snyders outlets. At the other stores, only the pharmacy files will be purchased for transfer to existing Walgreens locations.
“Our trusted pharmacy service goes back 109 years, including more than 80 years in Minnesota,” points out Jeff Bruneteau, who is the Walgreens vice president responsible for the market.
Prior to the acquisition, the company operated some 132 outlets in the state. Walgreens holds the top spot in the Minneapolis/St. Paul drug store market with a 32% share.
“Our pharmacy staffs will be ready to make the transition as seamless as possible for Snyders patients. We look forward to continuing Snyders’ tradition of quality pharmacy service in communities across Minnesota,” notes Bruneteau, adding that customers whose prescriptions are shifted from one store to another will be notified by letter.
The purchase of Snyders, which was founded in 1928, is the latest in a series of acquisitions of regional chains undertaken by Walgreens.
In recent years, the company bought Happy Harry’s Inc. in Delaware, Medic Drugs in greater Cleveland, Drug Fair Group in New Jersey and part of Farmacias El Amal in Puerto Rico.
For Edmonton, Alberta-based Katz, the deal was motivated by a desire to concentrate on its Canadian operations.
“We have a very large organization in Canada consisting of 1,500 corporate, banner and franchised stores,” comments Andy Giancamilli, chief executive officer of Rexall, a Katz Group company. “When you look at what we had in Minnesota, just 25 stores, it didn’t make sense to maintain a presence in that market. So we decided that, if we weren’t going to invest and actively grow there, then we should focus on our core strengths. And that’s what we did.”
He says that Katz, which will stop operating its remaining company-owned stores in Minnesota when the transaction is finalized, intends to deploy its resources where they will have the greatest impact.
Giancamilli expresses confidence that the former Snyders outlets will continue to
flourish.
“Snyders has good stores, a good prescription base and great customers, who are very loyal,” he says. “They’ll be served well by Walgreens.”
The new owner is expected to maintain continuity of service by hiring many of Snyders’ 500 staff members, especially those in the pharmacy department.
“Retention of prescription files is very closely related to pharmacists,” notes Giancamilli. “So Walgreens will interview people and do what they always do.”
