Rite Aid Corporation Confirms Prior Rejection of Non-Binding, Off-Market Proposal from Spear Point Capital Management

Rhea-AI Summary

Rite Aid Corporation (NYSE: RAD) has declined a non-binding acquisition offer from Spear Point Capital Management, citing significant deficiencies. The Board found the proposal unfeasible, lacking evidence of financing, and imposing unreasonable exclusivity terms. The proposal also contradicted existing debt terms that could trigger payments upon a change of control. Despite the rejection, Rite Aid remains committed to enhancing shareholder value through its growth strategy as a full-service pharmacy.

Positive

• Rite Aid's commitment to executing its growth strategy.
• Ongoing focus on enhancing shareholder value.

Negative

• Rejection of the acquisition proposal indicates potential instability or lack of interest from investors.
• Proposal lacked credible financing evidence.
• Conditions of the proposal contradicted existing debt agreements.

PHILADELPHIA--(BUSINESS WIRE)-- Rite Aid Corporation (NYSE: RAD) confirmed that it previously rejected a non-binding, off-market proposal from Spear Point Capital Management (“Spear Point”) to acquire all of the outstanding shares of the Company’s common stock. The Company and its Board of Directors reviewed the proposal with the assistance of its financial and legal advisors, and the Board concluded that the proposal was not credible and did not warrant further exploration.

In making its determination, the Board considered, among other defects, that the Spear Point proposal provided no evidence of financing, required multiple months of exclusivity and then called for Rite Aid to spend months soliciting competing offers. In addition, Spear Point’s proposal was conditioned on none of the Company’s debt becoming due and payable upon a change in control, which contradicts the terms of nearly all of Rite Aid’s debt instruments. Furthermore, Spear Point has no track record of acquiring public companies the size and complexity of Rite Aid.

The Company remains focused on executing its growth strategy through continued leadership as a full-service pharmacy company, and will, as always, be responsive to credible proposals that will enhance stockholder value.

About Rite Aid Corporation

Rite Aid Corporation is on the front lines of delivering healthcare services and retail products to Americans 365 days a year. Our pharmacists are uniquely positioned to engage with customers and improve their health outcomes. We provide an array of whole being health products and services for the entire family through over 2,400 retail pharmacy locations across 17 states. Through Elixir, we provide pharmacy benefits and services to millions of members nationwide. For more information, visit www.riteaid.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220421005583/en/

INVESTORS:

Byron Purcell

(717) 975-3710

investor@riteaid.com

MEDIA:

Terri Hickey

(717) 975-5718

press@riteaid.com

Source: Rite Aid Corporation

FAQ

What did Rite Aid say about the acquisition proposal from Spear Point?

Rite Aid confirmed that it rejected Spear Point's non-binding acquisition proposal due to significant deficiencies.

Why did Rite Aid reject Spear Point's offer?

The Board deemed the proposal uncredible, lacking evidence of financing and imposing unreasonable exclusivity terms.

How does Rite Aid plan to enhance shareholder value?

Rite Aid is focused on executing its growth strategy as a full-service pharmacy company.

What are the implications of Rite Aid's rejection of the acquisition proposal?

The rejection could indicate potential instability or lack of interest from investors in Rite Aid.