CVS to Acquire Revco in $2.8-Billion Deal

Woonsocket, R.I.-based CVS Corp., a leading East Coast drugstore chain, is branching into the Midwest and South with the $2.8-billion takeover of Revco DS Inc. of Twinsburg, Ohio. By combining, the drugstores hope to gain more bargaining power by offering insurers a longer list of potential patients. Some analysts said they did not expect antitrust issues to be a major obstacle. The combined companies would have 4,000 outlets and revenue this year of about $13 billion. Revco shareholders will exchange each of their shares for CVS stock that would have been worth $44 (at Thursday’s closing price). CVS is also assuming about $900 million of Revco debt. Revco’s shares rose $3.375 to close at $41.375, while CVS rose $3.125 to close at $47.125. (Both companies trade on the New York Stock Exchange.)