...Rite Aid Corp.'s `B' rating incorporates recent weakening in drug retail results and concerns regarding the company's ability to stabilize EBITDA following the sale of 43% of stores and three distribution centers to Walgreens Boots Alliance, Inc. (BBB/Stable) for $4.38 billion, or around 16.0x LTM EBITDA. Declining operating results, including average quarterly pharmacy same-store sales (SSS) declines of around 4% beginning in 2016, have been somewhat mitigated by more stable results at Rite Aid's Envision Pharmaceutical Services (EnvisionRx) pharmacy benefits management (PBM) business. Fitch Ratings expects limited FCF generation and high adjusted leverage of around 7.0x, even after more than $4 billion of debt paydown using sale proceeds....
