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After missing Friday's merger deadline, Walgreens Boots Alliance (WBA) and Rite Aid (RAD) are extending their agreement end date to July 31, slashing the takeover price and changing other terms in a bid to get regulatory approval.

Illinois-based Walgreens Boots Alliance first proposed to purchase East Pennsboro Township-based Rite Aid Corp.in fall 2015 for $9 per share.

(+) DKS, (+0.5%) Goldman Sachs upgrades rating to a buy from neutral, with an average price target of $62.

Walgreens had originally offered up to $9 per share, or $9.40 billion.

Rite Aid's shares plummeted 16% on the news, while WBA's were flat. If the pharmacy retailer divests 1,000 to 1,200 stores, the price per share will be prorated. The government wants the combined company to hive off a large amount of stores, the exact number of which has been the sticking point and the reason for the new price range of the deal.

Steve Krol, who holds about 240,000 Rite Aid shares, dubbed it "a sad day for Rite Aid shareholders". But the FTC so far has balked at a plan to divest 865 Rite Aid drugstores to Fred's Inc. for $950 million.

This marks the second time the goal post has been moved, with the two companies originally agreeing on a deadline of October 27, 2016. A merger agreement that expired Friday night to complete the transaction has now been extended from January 27, 2017 to July 31, 2017 "in order to allow the parties additional time to obtain regulatory approval", Walgreens said.

Rite Aid closed at $5.72 on Monday, down 17.46 percent.