Walgreen Co. has entered in a deal to acquire New York-based drugstore chain Duane Reade Holdings Inc. Walgreen will acquire Duane Reade from affiliates of Oak Hill Capital Partners for $1.08 billion, including debt and the deal is expected to be closed by August 31. Walgreen expects to increase its presence in the New York area in which it already operates 70 stores. Duane Reade has 257 drugstores in the New York City area.

Greg Wasson, President and CEO of Walgreen Co said, "Duane Reade is a compelling strategic acquisition that will immediately provide Walgreens with a leading position in the largest drugstore market in the U. S. Duane Reade's recent initiatives in urban retailing, customer loyalty and private brand products support and accelerate Walgreens strategy to enhance the customer experience in our network of more than 7,100 stores across the country".

Duane Reade will be operated under its own brand name and decisions will be made over time to effectively "harmonize" the two brands.

John A. Lederer, Chairman and CEO of Duane Reade said "We are very pleased that this national leader has recognized the successful transformation under way at Duane Reade, which is built upon a 50-year history of serving the needs of New Yorkers and has been supported by our shareholders, including Oak Hill Capital Partners. We will continue to be the drugstore New Yorkers turn to, just as Walgreens has been a trusted community pharmacy in other markets for more than 100 years".