Walgreens Takes Unfamiliar Route to Growth
By George Anderson
Walgreen Co. has always been proud that it has become the largest drugstore chain in the country through organic growth. It is just that philosophy that makes the announcement Walgreens has acquired Happy Harry’s, a 72 store regional chain with pharmacies in Delaware, Maryland, New Jersey and Pennsylvania, so unusual.
The last major acquisition for Walgreens was 1986, according to a company press release.
“Retail acquisitions are rare for us, but Happy Harry’s presented a unique opportunity and is a solid strategic fit,” said Dave Bernauer, chairman and chief executive officer, Walgreen Co.
Walgreens is not looking to make any major changes at Happy Harry’s, according to its vice president of store operations Frank Grilli.
“We plan to keep the name and look of the stores the same, while over time evaluating the benefits of incorporating or substituting the Walgreens name,” said Mr. Grilli. “The only exceptions to this are the eight stores in Pennsylvania, where the decision has already been made to convert the stores to the Walgreens name because of our stronger branding there.”
Moderator’s Comment: Do you see Walgreen Co.’s purchase of Happy Harry’s as a departure from its organic growth focus and a shift to a more merger and
acquisition approach? Considering its lack of experience in this area, what will Walgreens need to do to successfully integrate Happy Harry’s? –
George Anderson – Moderator