The Real Deal Miami

Walgreens to pick up DR chain in $1B deal

February 17, 2010 10:04AM

U.S. drugstore giant Walgreens is taking over New York City’s Duane Reade chain from Oak Hill Capital Partners in a cash deal valued at more than $1 billion, the company announced today. Duane Reade has 257 drugstores in the New York metropolitan area, 60 percent of which are in Manhattan. The chain, which will keep its name, has the highest sales per square foot among the country’s drug stores. The deal gives Walgreens the chance to play a powerful role in the city’s retail scene, and it has plans to add more Duane Reade branches in the coming years. The extent of the planned expansion is unclear. Walgreens is the largest drugstore chain in the U.S. with more than 7,100 stores, but currently operates only 70 in New York City. The transaction is expected to close by Aug. 31, Walgreens said. Oak Hill purchased Duane Reade in 2004 for $680 million plus $284 million in debt, Bloomberg reported.