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Two buyers took advantage of one of the longest sales J.C. Penney Company, Inc., has ever held. The retailer agreed on April 5 to sell its drugstore chain, Eckerd Corporation, to The Jean Coutu Group Inc. and CVS Corporation for $4.5 billion. Penney had been looking for a buyer since October. Penney had initially hoped to sell the Eckerd business as a whole, but reportedly opted to split the company because bids for the entire unit came in at only $4 billion. Several large private equity firms, including The Blackstone Group, Thomas H. Lee Company, Texas Pacific Group, and Kohlberg Kravis Roberts & Co., considered Eckerd, as did Camp Hill, Pennsylvania-based Rite-Aid Corporation. Eckerd and its buyers are all in the drugstore business. CVS will pay $2.15 billion for Eckerd’s pharmacy benefits management and mail-order business, and its stores in the southern states. Coutu will pay $2.4 billion for Eckerd’s headquarters and its drugstores in 13 Northeast and mid-Atlantic states. Coutu already owns stores in those areas through its Brooks Pharmacy subsidiary, based in Warwick, Rhode Island. The deal is expected to close by the end of July, pending regulatory approvals. For acquiror The Jean Coutu Group Inc. (Longueuil, Quebec) McDermott, Will & Emery (Chicago): Corporate: Christopher Donovan, Spencer Klein, Gregory Puff, Eric Reimer, Dennis White, and associates Nathanael Davis, Felise Feingold, Jeffrey Rothschild, and Tanisha Sullivan. Tax: Daniel Zucker. Employee benefits: Todd Garvelink. Employment: Dawn Groman. Environmental: Susan Cooke. Litigation: Donald Frederico, Steve Kasten, and Mark Pearlstein. Antitrust: Jon Dubrow, Raymond Jacobsen, Jr., and Joseph Winterscheid. Health law: Robert Nicholas and associate Travis Smith. Food and drug regulatory issues: Marc Sorini. Intellectual property: John Dabney. (Klein, Puff, Rothschild, Garvelink, and Groman are in New York; Reimer is in Los Angeles; Zucker is in Chicago; and Dubrow, Jacobsen, Winterscheid, Nicholas, Sorini, and Dabney are in Washington.) White has done work for Coutu and its subsidiary, Brooks Pharmacy, in the United States for seven years. He represented the company in the 2001 purchase of 84 Osco Drugstore properties in the Northeast from Albertson’s, Inc. Fasken Martineau DuMoulin (Montreal): Securities and M&A: Jean-Pierre Chamberland, Yvon Martineau, Peter Villani, and associate Mireille Tremblay. Banking: Marc Novello and associate Martin Racicot. Corporate and commercial: Sylvie Bourdeau and Philippe David. Tax: Benoit Dupuis. (All are in Montreal except David, who is in New York.) Yvon Martineau is on Coutu’s board and has represented the company since its founding in 1978. For acquiror CVS Corporation (Woonsocket, Rhode Island) In-house: General counsel Zenon Paul Lankowsky and chief legal officer Douglas Sgarro. Davis Polk & Wardwell (New York): Corporate: Louis Goldberg, Dennis Hersch, and associates Kirtee Kapoor, Edward So, and Fumiko Yokoo. Tax: Dana Trier, counsel Laura Barzilai and associate Kimberly Helene Zelnick. Employment: counsel George Ince, Jr., and associates Amanda Bixler and Ada Dekhtyar. Environmental: counsel Loyti Cheng and associate Judy Melillo. Antitrust: Ronan Harty and associate Stephen Merrill Pepper. CVS had been a part of Melville Corporation, a longtime Davis Polk client. In the mid-1990s the firm assisted Melville in spinning off or selling most of its businesses except CVS, the survivor corporation. Davis Polk then represented CVS in its purchases of Revco D.S., Inc., for $3.9 billion in 1997 and Arbor Drugs Inc. for $1.5 billion in 1998. Mintz, Levin, Cohn, Ferris, Glovsky and Popeo (Boston): Real estate: Stephen Friedberg, Mary Lee Moore, and Andrew Urban. Health care: Susan Berson, Deborah Daccord, and associates Theresa Carnegie and Jennifer Williams. Environmental: Susan Phillips and associate Lyn Lustig. (Friedberg is in New York; Berson, Carnegie, and Williams are in Washington, D.C.) Mintz Levin has served as CVS’s outside counsel since 1985 on a variety of issues. For seller J.C. Penney Company, Inc. (Plano, Texas) In-house: General counsel Charles Lotter, associate general counsel Jeffrey Vawrinek, and associate general counsel � antitrust Robert Hood. Jones Day (Cleveland): M&A: Lisa Durham, Robert Estep, and associates Gregory Kopel, Jason Krieser, Amy Nelson, Mark Robinson, and Steven Stennett. Tax: Dennis Drapkin and associate Scott Frodyma. Employee benefits: James Carey, Alan Miller, and associate Michael Blais. Real estate: Frederick Rerko and associate Michelle Brown. Antitrust: Robert Jones and Phillip Proger. Intellectual property: counsel Betty Ungerman. (All are in Dallas except Kopel, who is in Houston; Frodyma, in Cleveland; and Jones and Proger, in Washington, D.C.) Jones Day has done work for J.C. Penney since the 1980s, principally in employee benefits, labor and employment, and commercial litigation. Essentially the same Jones Day team represented Penney when it sold its insurance services direct marketing subsidiary to Aegon, N.V., in 2001 for $1.6 billion, and in the 2002 Chapter 11 bankruptcy and restructuring of Penney’s holding company.

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