Walgreens to Acquire Rite Aid in $17.2 Billion Deal

• Tuesday, Oct. 27, after the market close, Alliance announced an agreement to acquire smaller drugstore chain Rite Aid for $9.4 billion in cash, offering $9 per share in cash, which represents a 48% premium to Rite Aid’s closing price of $6.08 on Monday. Including debt, the deal is valued at $17.2 billion, the company said. • The deal would bring together the #1 and #3 retail pharmacy companies, creating a pharmacy giant with over 13,000 stores and more than $67.1 billion in combined revenue, according to Drug Store News’s Annual PoweRx Industry Rankings. • The combined company would have an especially strong presence in California and New York. The combination is expected to realize cost synergies of at least $1 billion annually. • The boards of both companies have approved the transaction, which must receive Hart-Scott-Rodino approval and is expected to close during the second half of calendar 2016.

SELECTED WALGREENS ACQUISITIONS

Date Value Acquisition Business Announced (USD Mil.) 27/10/2015 Rite Aid Corp Pharmacy 9,400 28/07/2015 TytoCare Healthcare Technology Undiscl. 10/02/2015 Clinical Holdings Clinical Development Undiscl. 16/10/2014 MedAvail Technologies Pharmacy Kiosk Undiscl. 24/03/2011 drugstore.com Online Pharmacy 409 17/02/2010 Holdings Drugstore 1,100 08/05/2009 31 Drug Fair stores Pharmacy Undiscl. 17/03/2008 Whole Health Management Home Care & Wellness Center Undiscl. 17/03/2008 Take Care Health Systems Healthcare Clinic Undiscl. 02/07/2007 OptionCare Enterprises Home Healthcare Service 850 29/06/2006 Medmark Specialty Pharmacy 140 05/06/2006 Happy Harry's Discount Drugstore Undiscl. 05/07/2006 C&M Pharmacy Pharmacy Undiscl. 16/02/2006 Canadian Valley Medical Solutions Home Care Undiscl. 01/11/2005 Home Pharmacy of California Specialty Pharmacy Undiscl. 04/10/2005 Schraft's A Walgreens Specialty Specialty Pharmacy 850 Pharmacy Source: Bloomberg and company reports

DEBORAH WEINSWIG, EXECUTIVE DIRECTOR –HEAD OF GLOBAL RETAIL & TECHNOLOGY [email protected] US: 917.655.6790 HK: 852.6119.1779 CN: 86.186.1420.3016 1 Copyright © 2015 The Fung Group. All rights reserved.

Deborah Weinswig, CPA Executive Director—Head of Global Retail & Technology Fung Business Intelligence Centre New York: 917.655.6790 Hong Kong: 852.6119.1779 [email protected]

Filippo Battaini [email protected] Marie Driscoll, CFA [email protected] John Harmon, CFA [email protected] Aragorn Ho [email protected] John Mercer [email protected] Shoshana Pollack [email protected] Kiril Popov [email protected] Jing Wang [email protected] Steven Winnick [email protected]

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DEBORAH WEINSWIG, EXECUTIVE DIRECTOR –HEAD OF GLOBAL RETAIL & TECHNOLOGY [email protected] US: 917.655.6790 HK: 852.6119.1779 CN: 86.186.1420.3016 2 Copyright © 2015 The Fung Group. All rights reserved.