Rite Aid is advancing its bankruptcy restructuring plan by closing an additional 53 stores across nine states, Fox News reported Thursday.
The drugstore chain is shutting down stores in several states, including California, Maryland, Massachusetts, Michigan, New Jersey, New York, Ohio, Pennsylvania and Virginia. This decision is a strategic move to consolidate operations and manage debts effectively, according to Fox News. Initially filed October, Rite Aid’s bankruptcy aimed to streamline operations by discontinuing underperforming stores and divesting from secondary business sectors. The list of closures, which initially included 154 stores, has expanded during the bankruptcy process.
Rite Aid plans to close 53 more drugstores, including four on Long Island, according to bankruptcy court filings.
The retailer has closed hundreds of stores across the country since filing for Chapter 11 bankruptcy protection.
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The list of closures, which initially included 154 stores, has expanded during the bankruptcy process. Despite the closures, Rite Aid remains committed to optimizing its financial standing and has avoided any legal culpability, Fox News reported. A bankruptcy judge authorized Rite Aid on March 28 to proceed with a plan that might lead to the company’s sale. This plan grants control over the company’s equity to bondholders. Additionally, the company is on the verge of settling significant disputes, including those related to a federal investigation into its opioid sales practices. (RELATED: Iconic Discount Merchandise Brand To Shutter Around 1,000 Stores As Harsh Economic Factors Weigh On Sales)
Rite Aid is currently preparing to collect votes from bondholders, who will play a pivotal role in the bankruptcy outcome. Voting rights have been exclusively granted to this group, with a voting deadline set for Monday, Fox News stated. While Rite Aid has refrained from publicly disclosing the affected locations, a spokesperson stated that the identified stores were selected to alleviate rental costs and enhance financial health. The specific timing for these closures has not been disclosed, but the company aims to secure final court approval for its restructuring plan by April 22.
Since its inception in 1962 with a single pharmacy in Scranton, Pennsylvania, Rite Aid has grown to operate approximately 1,700 retail locations across 16 states, employing around 45,000 people, according to Fox News.