Walgreen May Launch Hostile Longs Bid
In a letter sent to the board of Longs on Monday, Walgreen disputed Longs' position that it's not willing to accept the regulatory risks in connection with an acquisition. Walgreen also said Longs should have no concern with its ability to finance the proposed transaction.
"Our proposal is compelling -- it would deliver superior value to Longs stockholders relative to the CVS transaction and can be consummated without undue delay," said the letter from Jeffrey Rein, Walgreen chairman and CEO.
In August, Longs agreed to sell itself to CVS Caremark (CVS) for about $2.9 billion, or $71.50 a share. The offer carried a sizable premium, but because Longs controls a valuable real estate portfolio -- and hasn't gotten the portfolio appraised -- its shareholders felt shortchanged. As a result, CVS managed to secure just 4.5% of Longs' stock by the time its first tender offer expired.Earlier this month, Walgreen offered to buy Longs for $75 a share, and also agreed to cover a breakup fee, equal to another $3 a share, if Longs would accept its proposal. But Longs has rebuffed the offer from Walgreen.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV