Canadian Group Considers Buying Eckerd

Discussion
Oct 15, 2003
George Anderson

By George Anderson


The Canadian parent of Brooks Pharmacies, Jean Coutu Group, has asked the investment firm soliciting bids for the Eckerd drugstore chain to provide it with financial details
on the company.


Jean Coutu’s chief executive officer, Francois Coutu, told analysts yesterday, “If there is a potential serious acquisition in the U.S., you can count on us being there.”


It is not known whether Jean Coutu would attempt to purchase all or part of Eckerd. There is speculation it may seek to make a deal with CVS to divvy up Eckerd. CVS would face
some regulatory hurdles in certain areas where its present operations overlap those of Eckerd.


Eckerd is owned by J.C. Penney. The department store chain’s spokesperson, Quinton Crenshaw, told the Associated Press, “As of now, we’re not in a position to make an
announcement about Eckerd. We won’t be making a decision about Eckerd until by the end of the year.”


Moderator’s Comment: What do you think would be the best selling scenario for Eckerd? What will it take to turn Eckerd around, regardless of who owns
the business?


We see a culture clash coming if a Jean Coutu deal for Eckerd should go through and we’re not talking a Canadian and American thing.


Over the past couple of years we’ve done a few personal store audits of Brooks Pharmacies and found them cluttered and in general need of a remodel.


We’ve also found store personnel who were friendly, helpful and seemed to know most of the shoppers by name.


Eckerd stores, we’ve visited have often had holes in stock and unenthusiastic employees. [George
Anderson – Moderator
]

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