Walgreens Moves Online With Drugstore.com Purchase

The competition between drug store chains has been fierce in recent years, often to the consumer’s benefit. Now, some consolidation is setting in.

Walgreen Co. says it will acquire Drugstore.com for about $429 million in cash. Drugstore.com is an online retailer of health, beauty, clinical skincare and vision products. It operates the affiliated websites Beauty.com, SkinStore.com and VisionDirect.com.

“Our acquisition of drugstore.com today significantly accelerates our online strategy to leverage the best community store network in America by becoming the most convenient choice for health and daily living needs whether customers shop online or in our stores,” said Walgreens President and CEO Greg Wasson.

Walgreens says it expects the acquisition to give it access to more than three million consumers who now do business with Drugstore.com and its affiliated websites. In addition, the Walgreens’ product line will grow by approximately 60,000 items that are sold by the websites.

“As a result, we are positioned better than ever to be the most convenient multi-channel retailer of health and daily living needs in America – offering customers what they want, when they want it and where they want it,” Wasson said.

Walgreens has a large brick and mortar presence in both urban and rural markets, often competing with other discount chains, including Wal-Mart. The acquisition now gives the chain a greatly expanded online presence.

With more than $456 million in sales in 2010, Drugstore.com is ranked as the eighth-largest e-tailer in the U.S. according to Internet Retailer magazine. Walgreens will maintain drugstore.com’s corporate office in Bellevue, Wash., after the transaction is completed. drugstore.com employs approximately 1,000 people at its offices, call center and distribution centers.