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Walgreens makes offer for Longs Drug Stores

Walgreen, hoping to undo CVS deal, makes rival offer to buy Longs Drug Stores for $2.8 billion

NEW YORK (AP) -- Walgreen Co. made an offer late Friday to buy Longs Drug Stores Corp. for $2.8 billion, hoping to unseat a rival offer from CVS Caremark Corp. that Longs had already accepted.

Deerfield, Ill.-based Walgreen said it would pay $75 a share in cash to buy Walnut Creek, Calif.-based Longs, besting CVS's price of $71.50 per share, also in cash, which was equivalent to about $2.7 billion. Either deal would also include the assumption of about $200 million in debt.

Longs shares rose 4 percent to $74.50 in after-hours trading.

...Longs has face dissent from some shareholders over the value of the CVS deal.

Earlier Friday, one of the largest shareholders in Longs said it opposed the deal with CVS and had identified four other potential buyers for the drug store chain.

Pershing Square Capital Management, which owns about 3 million shares -- a 9.2 percent stake -- of Longs, has previously said that CVS's bid didn't adequately value Longs' real estate holdings.

Two other major shareholders, Advisory Research and CtW Investment Group, have also publicly questioned the CVS deal.

Speaking in a television interview Friday before the Walgreen announcement, CVS Chief Executive Tom Ryan said the company does not intend to raise its bid.

"We think we are paying a full and fair price," he said. "We're not moving. We're done."

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