Pennsylvania Chain Offers to Buy Revco
AKRON, Ohio (AP) _ The drug store operator Rite Aid Corp. has made a bid in federal bankruptcy court for the chain of 1,150 Revco drug stores.
Both chains do most of their business in the eastern United States. Rite Aid operates 2,440 drug stores in 22 states, while Revco’s drug stores are in 10 states.
Rite-Aid, based in Shiremanstown, Pa., said the deal would provide about $440 million in cash to Revco’s senior creditors. Rite-Aid would assume responsibility for some other debts and distribute Rite-Aid stock instead of cash payments to the company’s junior creditors.
Rite-Aid said it believes its cash payments and the use of its own stock provide a higher and more certain value for creditors than other plans filed so far. Its plan was filed late Wednesday afternoon in a U.S. Bankruptcy Court.
Officials of privately held Revco D.S. Inc., based in nearby Twinsburg, couldn’t immediately comment on the plan.
″We have heard that a plan was filed late this afternoon, but we have not seen it and don’t know anything about it,″ Revco spokeswoman Diana Lueptow said Wednesday evening.
Revco sought protection from creditors under Chapter 11 of the U.S. Bankruptcy Code in July 1988.
Creditors last week rejected a takeover plan filed by Florida-based Jack Eckerd Corp., a rival drug store chain.
At the time, Revco said committees representing three groups of creditors indicated that they would pursue their own plan for reorganizing Revco’s finances and that Revco would support them.
In addition to its chain of drug stores, Rite-Aid operates several auto parts stores, bookstores and dry cleaning stores.