Headlines

Eckerd Drugs: It’s Not Pennies

J.C. Penney evaluates subsidiary at $4.37 billion

Published

20 years ago

March 31, 2004

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J.C. Penney Co. Inc. (Plano, Texas) has placed the fair value of its stake in its Eckerd Drugs chain at $4.37 billion.

The department store organization, in the midst of trying to sell the 2700-store drugstore subsidiary, disclosed its valuation in a filing with the Securities and Exchange Commission.

Wall Street analysts have estimated that Eckerd could be worth $3.5 billion to $4.5 billion, but some have suggested that the drawn-out process of selling Eckerd might indicate that offers are on the low side.

Penney has been talking to potential Eckerd buyers for several months. According to published reports, it has held negotiations with CVS Corp. (Woonsocket, R.I., which operates 4200 drugstores), Rite Aid Corp. (Camp Hill, Pa., which owns 3400 stores) and The Jean Coutu Group Inc. (Longueuil, Que., Canada’s third-largest drug retailer).

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