New York City CVS Caremark chief executive Tom Ryan expects enough Longs Drug Stores shareholders will accept CVS' $2.9 billion bid despite some shareholder pressure to increase the deal price.
Speaking at an investor conference Thursday, Ryan said he believes the deal will get the necessary two-thirds shareholder approval, according to the Associated Press. CVS' tender offer expires Sept. 15, although Ryan noted it can be extended for up to a year. He also said the Longs stores are more valuable to CVS than most other retailers, and not many banks and retailers are looking for sites that size.
Despite the 32% premium CVS is offering to pay for the shares, hedge funds and union-sponsored pension funds are skeptical, and fear that CVS is low-balling the value of Longs real estate assets in California, Hawaii and Nevada.