Eckerd-Revco merger: what's behind the offer

Drug Store News, Oct 14, 1991

CLEARWATER, Fla. -- Jack Eckerd got a taste of what it could do with Revco's stores over the past year, after it bought 223 Revco units in the South and began squeezing double-digit sales gains out of the 98 top-performing units it kept open. "We really like their performance," said Eckerd spokesman Gene Ormond. "We are operating the best of the best" of the stores purchased.

Eckerd Chairman Stewart Turley also pointed to the successful incorporation of those former Revco stores and their employees when discussing Eckerd's bid for Revco itself. Adding fuel to Eckerd's interest in the bankrupt drug chain was the willingness of some creditor groups--frustrated in their own efforts to resolve the lengthy reorganization process--to entertain takeover proposals from outside Revco.

If Eckerd succeeds in acquiring Revco, it is certain to close and consolidate a number of Revco stores in the states where both chains overlap--North and South Carolina, Georgia, and Tennessee in particular. However, the deal would also put Eckerd into new states like Pennsylvania, Ohio, Virginia and New York, where there is no overlap.