Penney spends big

Article Abstract:

JC Penney has acquired Eckerd, a pharmacy chain, for $3.3 billion. The high price means that rivals are not likely to seek to disrupt the acquisition. The new group will have around 2,800 pharmacies. Eckerd stores are mainly located in the south west and southerns US states, while JC Penney's Thrift stores are mainly located in the north east, and are likely to change to the Eckerd name. Pharmacy chains are having to concentrate due to pressure from wholesale medical products companies and pharmaceutical concerns which seek to deal with larger firms.

Drug Store Chains, Mergers, acquisitions and divestments, Chain stores, Eckerd Corp., ECK

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JC Penney

Article Abstract:

JC Penney ranks fifth among US retailers where the company has 1,200 stores. There is little scope for expanding its department store business in the US, so the company is expanding into Latin America and setting up drugstores. The company is also involved in insurance and banking. The company performed well in the early 1990s recession though later results have given some cause for concern. There is also concern over US consumer spending levels before Christmas 1996, since pre-Christmas sales are critical for retailers.

Drug Stores, Company Profile

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House of Fraser

Article Abstract:

House of Fraser is a department store concern which has seen a drop in its stock price, and there is concern about the debt levels of the group. Many of the company's stores are in the wrong location or are old, and some stores may be sold following the arrival of a new chairman, Robert Shrager. The group will have to tackle its debt due to the level of interest payments which are covered only twice by its operating profit. Dividend cover is only 1.2 time net profit.

House of Fraser PLC

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