An ailing giant in the retail pharmacy world has filed for bankruptcy for the second time in less than three years, and this time may be the death knell — it plans to close or sell its remaining stores.
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Philadelphia-based Rite Aid initiated the proceedings in a New Jersey bankruptcy court on Monday.
The chain “is pursuing a strategic and value-maximizing sale process for substantially all of its assets,” according to a press release.
That will include closing and selling off its remaining stores and warehouses, according to court documents obtained by The Philadelphia Inquirer.
“While we have continued to face financial challenges, intensified by the rapidly evolving retail and healthcare landscapes in which we operate, we are encouraged by meaningful interest from a number of potential national and regional strategic acquirors,” Rite Aid CEO Matt Schroeder said in a statement.
Rite Aid has 1,240 locations across 15 U.S. states, according to the company’s website. That real estate will join the former Party City and Bed Bath & Beyond locations that have also entered the market due to bankruptcy proceedings in recent months.
Rite Aid is also planning job cuts at its corporate headquarters in the Philadelphia Navy Yard. The chain’s footprint in greater Philly has shrunk by 40% since 2022, the Inquirer reported.
Rite Aid closed more than 800 locations after it first filed for bankruptcy in October 2023, citing inflation and changes in consumer behavior postpandemic.
It emerged from the process as a private company about a year later with $2B less debt, around $2.5B in exit financing and a new CEO with a history of restructuring companies.
But issues at the chain quickly reemerged. Associates have struggled to keep shelves stocked in recent years as increased concerns about theft have led many retailers like Rite Aid to keep merchandise locked up in cases.
Spokespeople for Rite Aid didn’t immediately respond to Bisnow’s request for comment.
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