Walgreen to Buy Happy Harry's

Walgreen Co. (WAG) on Monday said it had agreed to buy the Delaware-based Happy Harry's chain of 76 pharmacies for an undisclosed amount, its largest acquisition in 20 years.

Walgreen, the largest U.S. drugstore chain by revenue, said it would continue to focus on opening stores itself rather than on acquiring them.

"Retail acquisitions are rare for us, but Happy Harry's presented a unique opportunity and is a solid strategic fit," Walgreen Chief Executive Dave Bernauer said in a statement.

The deal is subject to regulatory approval and expected to close this summer. It will give Walgreen all 76 Happy Harry's stores in Delaware, Pennsylvania, Maryland and New Jersey, and an office and distribution center in Newark, Delaware.

Happy Harry's Chief Executive Alan Levin, whose father Harry founded the company in 1962, will continue working with Walgreen after the deal closes.

Walgreen said it planned to keep the Happy Harry's name at most stores for now, but would consider incorporating or substituting the Walgreens name over time. Eight stores in Pennsylvania will be converted to the Walgreens name from the start.

The deal is Walgreen's largest since the company bought the 66-store Medi Mart chain in 1986.

Shares of Walgreen slipped 28 cents, or 0.7 percent, to $42.37 in morning New York Stock Exchange trading.

Walgreen, which is based in Deerfield, Illinois, operates 5,251 stores, while rival CVS Corp. (CVS) has more than 6,100. CVS just acquired about 700 Sav-on and Osco stores from Albertsons Inc. last week.