Walgreens buying Rite Aid for $9.4 billion in cash

Walgreens, the biggest U.S. drugstore chain, on Tuesday confirmed it would buy Rite Aid (RAD) for $9.41 billion in cash.

The Wall Street Journal first reported news of the deal.

Walgreens says it will pay $9 per share for Camp Hill, Pennsylvania-based Rite Aid Corp. That's a premium of roughly 48 percent to the closing price of Rite Aid.

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

Walgreens Boots Alliance Inc. (WBA), based in Deerfield, Illinois, is the largest U.S. drugstore chain, based on store counts. Rite Aid is the third largest. The deal expected to close in the second half of next year.

That tie-up would make one of the world's largest pharmaceutical buyers even bigger at a time when other key health care players like insurers and drugmakers also are expanding through multi-billion dollar deals.

The Deerfield, Illinois, company is less than a year removed from closing its acquisition of European health and beauty retailer Alliance Boots, which runs the biggest drugstore chain in the United Kingdom. That combination created Walgreens Boots Alliance Inc., which runs more than 13,200 stores and 350 distribution centers in 11 countries.