Walgreens to buy Rite Aid for $9.41 billion

NEW YORK -- Walgreens confirmed Tuesday that it will buy rival Rite Aid for about $9.41 billion in cash, creating a drugstore giant with nearly 18,000 stores around the world.

The deal comes less than year after Walgreens bought European health and beauty retailer Alliance Boots. Besides its namesake stores, Deerfield, Illinois-based Walgreens also owns Duane Reade stores in the U.S.

Walgreens said it will pay $9 for each share of Rite Aid Corp. That's a 48 percent premium to Rite Aid's closing price of $6.08 Monday. Shares of both companies jumped Tuesday after The Wall Street Journal first reported the deal.

The companies said the deal is worth $17.2 billion, when debt is included.

Rite Aid stores will initially keep its name after the deal closes, Walgreens said, but that may change over time. The deal is expected to close in the second half of next year.

Walgreens Boots Alliance Inc. has more than 13,100 stores around the world, and is the largest U.S. drugstore chain. Rite Aid has more than 4,600 stores in the U.S.