More Closings Expected As Drugstore Chain Warns It May Be Forced To Liquidate, Analysts Say.
Drugstore chain Rite Aid has disclosed the amount of store space it initially plans to close. But that’s only the first round of brick-and-mortar shutdowns industry professionals expect, based on the retailer’s filings and attorney statements in its Chapter 11 bankruptcy proceedings.
The Philadelphia-based retailer has put in motion its plan to optimize its physical footprint of about 2,100 stores across 17 states. That process includes not only shutting underperforming stores, but attempting to renegotiate better terms for leases with landlords for other locations. In addition, bids for part of a batch of store leases are due Wednesday as Rite Aid says in court documents it sees trimming its store fleet as crucial to the company’s successful financial reorganization.
The retailer filed for bankruptcy protection about a week ago in New Jersey, a move Rite Aid said was necessary because of a crushing debt load, battering from a growing group of competitors, and a deluge of pending lawsuits alleging that it oversupplied prescription pain killers, contributing to the nation’s opioid epidemic.