CVS Health has acquired big box retailer Target's pharmacy and clinic businesses for approximately $1.9 billion and will operate the pharmacies under CVS branding in a store-within-a-store format.

The partnership allows Target to enhance the health care experience for its guests while expanding CVS Health's retail presence in new markets such as Seattle, Denver, Portland and Salt Lake City.

"At Target, we've talked a lot about the evolving preferences of our guests and this partnership demonstrates that we're committed to putting them at the forefront of everything we do," says Brian Cornell, chairman and chief executive officer, Target. "By partnering with CVS Health, we will offer our guests industry leading health care services, and at the same time, sharpen our focus on elevating the way we deliver wellness products and experiences to our guests."  

The deal includes more than 1,660 pharmacies across 47 states and a CVS pharmacy will be included in all new Target stores that offer pharmacy services.

Additionally, Target's nearly 80 clinic locations will be rebranded as MinuteClinic, and CVS Health plans to open up to 20 new clinics in Target stores within three years of the close of the transaction. The partners also plan to develop five to 10 small, flexible format stores over a two-year period following the deal close, which will each be branded as TargetExpress and include a CVS pharmacy.

"This strategic relationship with Target supports the highly complementary customer base, brand and culture we share," says Larry Merlo, president and chief executive officer, CVS Health. "When we introduced the new name for our company, CVS Health, we began a new era of growth with a broader health care focus and an appreciation of the rise of health care consumerism with consumer choice and accountability growing. This relationship with Target will provide consumers with expanded options and access to our unique health care services that lead to better health outcomes and lower overall health care costs."