Will This Recent Buy Help Rite Aid Compete With Walgreens and CVS?
Rite Aid (NYSE:RAD) announced that it will acquire RediClinic, an operator of retail clinics, according to a Thursday press release. RediClinic currently operates 30 retail clinics throughout several metropolitan areas in Texas, including San Antonio, Houston, and Austin.
As a result of the acquisition, RediClinic will now operate as a subsidiary of Rite Aid. RediClinics’ locations all operate within or next to grocery stores in Texas. Following the acquisition, RediClinic plans to expand, adding more than 70 new clinics in the next 18-24 months alone, some of which will operate out of a Rite Aid stores, according to FierceRetail.
“RediClinic is a pioneer and a leader in the retail clinic industry, having provided high-quality, convenient, and affordable health care to nearly one and a half million people since opening it’s first clinic in 2005,” said RiteAid Chairman and CEO John Standley.
He added, per the company’s press release: “Retail clinics play a critical role in today’s health care delivery system and will play an important role in Rite Aid’s overall health and wellness strategy. We are committed to working with RediClinic to expand its current footprint in Texas, and, in the near future, begin to bring its expertise in delivering convenient healthcare and wellness programs to Rite Aid customers in select Rite Aid markets.”
The acquisition of RediClinic follows a trend among drugstore chains, which have begun to supplement their stores with more healthcare services. Rite Aid’s competitors, Walgreens (NYSE:WAG) and CVS (NYSE:CVS), have both built hundreds of retail health clinics within their stores in the past two years in a push to provide more care and services in order to remain competitive.
The strategy fits in with Rite Aid’s transition to what the company calls its “Wellness Store” format, in which Rite Aid stores will offer more organic food, natural personal care products, and fitness equipment. The company currently has more than 1,000 Wellness Stores nationally, and will continue to convert stores to the new format as part of its expansion, FierceRetail reports.
The company is also planning on expanding its health coaching program for people who have chronic conditions after acquiring the Boston-based Health Dialog Services, which offers care analytics and health advising services.
Rite Aid hasn’t disclosed any of the terms of the deal.