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A Utah institution since the 1930s, American Stores Co. has agreed to sell the last of its retail stores in the Beehive State.

"We no longer have any retail operations in Utah," said American Stores Co. spokesman Troy D'Ambrosio Tuesday afternoon.The company's board of directors has agreed in principle to sell 51 Osco Drug stores in Utah, Colorado and Wyoming to Pay Less Drug Stores of Wilsonville, Ore., for approximately $60 million.

The sale is subject to negotiation of a final sales agreement and an antitrust filing.

Under the agreement, Pay Less will purchase all Osco stores in the three states: 20 in Utah, 30 in Colorado and one in Wyoming.

Pay Less has agreed to hire most of Osco's store level employees in the affected stores. The Utah stores have employed about 1,600 people.

"At this point, the plan is to keep all the stores open," said Pay Less spokesman Pete Summer-field in a telephone interview.

As for the store managers affected by the sale of the Osco stores, Summerfield said company officials do not anticipate any "wholesale changes."

"We'll be sitting down with all of the staffs. We want the transition to be one of mutual agreement - that they want to stay and we want them to stay. Each one will be looked at individually," Summer-field said.

Summerfield said the Osco signs will come down as soon as the final agreements are signed and Pay Less conducts store inventories.

"When the inventories are done, you will begin to see signs change and merchandise changeovers to reflect the merchandise mix we use," Summerfield said.

After the sale, American Drug Stores Inc. will operate 631 stores in 24 states. The second largest drug chain in the nation, it is headquartered in Oak Brook, Ill. but operates its administrative offices in Salt Lake City.

American Stores closed its Utah Skaggs Alpha Beta grocery stores in January 1990, which displaced 1,256 workers. Eight months later, American Stores also closed its Skaggs Home Improvement stores. Those stores employed 130 people.

Pay Less Drug Stores is a subsidiary of K mart Corp. The company is 51 years old.