20 Federal Plaza W.
Youngstown, Ohio 44501-0400
Phar-Mor Inc. is one of the top ten deep discount drug store chains in the United States. The company rose to national prominence when, just seven years after it was founded, it catapulted to leadership of the deep discount drug retail segment. At its most prosperous, the chain boasted more than 300 locations in 34 states. In 1992, however, one of the largest corporate frauds in American history was perpetrated against Phar-Mor. As a result, the chain declared bankruptcy, cut its store locations by more than half, and was only beginning to show signs of emerging from the crisis in early 1995.
Phar-Mor came into existence as an affiliate of Pittsburgh-based Giant Eagle, Inc., a $1 billion, family-owned grocery chain with 50 locations. In 1981 Giant Eagle acquired Tamarkin Co., a privately owned grocery chain and distribution firm (later renamed Tamco Distributors Co.). Within a year, Giant Eagle heir David S. Shapira and former Tamarkin vice-president Michael J. "Mickey" Monus established Phar-Mor, Inc., an entry into the fast-growing deep discount drug segment.
The two businessmen seemed to confirm the adage that "opposites attract." The charismatic Monus developed a reputation for flamboyancy in the otherwise stuffy drug store industry--he reportedly traveled with an entourage by white limousine, for example. Shapira, on the other hand, was described as "a member of Pittsburgh's establishment" in an article appearing in Business Week in August 1992. Monus served as president of the new venture and Shapira as chief executive officer. Giant Eagle owned 50 percent of Phar-Mor, and real estate mogul Edward J. Debartolo, Sr., reportedly held a substantial equity interest in the new enterprise.
The deep discount segment of the drug store industry traces its history back to close-out shops that appeared during the Great Depression. The popularity of the concept waned when prosperity... [continues]
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