Walgreen to pay $429M for drugstore.com
DEERFIELD, Ill. (AP) — Drugstore operator Walgreen Co. said Thursday it will spend about $429 million to buy online retailer drugstore.com in a deal that gives it access to 3 million online customers.
The largest U.S. drugstore operator will give drugstore.com shareholders $3.80 in cash for each share of stock — more than double the $1.79 closing price of drugstore.com's stock on Wednesday. In early trading Thursday, the stock jumped $2 to $3.79.
The acquisition will add about 60,000 products to Walgreen's online offerings, and the Deerfield, Ill., company said it will significantly speed up its online strategy. Drugstore.com's websites include Beauty.com, SkinStore.com and VisionDirect.com.
Walgreen, like most retailers, is trying to develop an online presence, something that is imperative going forward, said Scotia Capital analyst Patricia A. Baker.
L.L. Bean embraces year-round free shipping
FREEPORT, Maine (AP) — Clothing and outdoors retailer L.L. Bean is upping the ante when it comes to free shipping by waiving shipping fees, all the time, with no minimum order.
Maine-based Bean, which announced the strategy Thursday, joins Zappos.com in offering permanent, no-strings-attached free shipping.
Steve Fuller, L.L. Bean's chief marketing officer, said the Maine-based company is adopting the policy because that's what customers want.
Andrew Lipsman, an analyst at Internet research firm comScore Inc., says the industry is moving in that direction. He says that in 2009, 30 to 35 percent of online holiday purchases involved free shipping; this past holiday season, the figure grew to 40 to 45 percent.
Low demand for TVs sunk Best Buy income
NEW YORK (AP) — Weak demand for pricey flat-screen TVs and notebook computers helped push Best Buy Co.'s fourth-quarter net income down 16 percent.Comment on this story
The decline adds urgency to the electronics retailer's bid to remake its business by opening smaller stores and focusing on more profitable, fast-growing categories such as tablet computers and smartphones.
Worries about its ability to deal with tanking TV sales combined with a muted outlook for fiscal 2012 to send Best Buy's stock down $1.72, or 5.4 percent, to close at $30.13 Thursday.
Fourth-quarter net income fell to $651 million, or $1.62 per share, from $779 million, or $1.82 per share.
Best Buy has been restructuring its international operations, particularly in China, and cutting costs in its U.S. supply chain. Excluding costs for those moves, net income totaled $1.98 per share. That beat the $1.84 analysts expected, according to FactSet.