Rite Aid is again seeking bankruptcy protection as the struggling drugstore chain says it will try to sell substantially all of its assets.
The company said Monday that its stores will remain open as it returns to Chapter 11 bankruptcy proceedings.
The company said it will work to ensure that customer prescriptions are transferred to other pharmacies as it goes through the sale process. The drugstore chain has lined up from some of its lenders $1.94 billion in new financing which help fund it through the sale and bankruptcy proceedings.
The company initially filed for bankruptcy protection in October 2023, with plans to sell parts of its business and restructure. The company ran more than 2,300 stores in 17 states before the filing.
Rite Aid said then that its initial voluntary Chapter 11 filing would allow it to slash debt and resolve litigation. The company sold its relatively small pharmacy benefits management business, Elixir Solutions, for around $576 million.
Rite Aid emerged from Chapter 11 nearly a year later as a private company. The drugstore chain said in a statement that it came out of the process stronger, “with a rightsized store footprint, more efficient operating model, significantly less debt and additional financial resources.”
Rite Aid’s creditors took ownership of the chain, which shrank to 1,245 stores in 15 states, according to its website.
A spokeswoman said in March that the company was “laser focused” on its retail pharmacies, including restocking its stores.
But in early May, empty white shelves dotted a store that sits a few miles from Rite Aid’s corporate headquarters in Philadelphia. The only rolls of wrapping paper in the store were some Christmas-themed offerings that leaned next to empty shelf space beneath a sign advertising “Great Value!”
The location also had a limited selection of profitable beauty products and drugstore staples such as Qtips and cotton balls.
Retail analyst Neil Saunders said such a look encourages shoppers not to return.
“They’re actively pushing customers away,” said Saunders, managing director of the consulting and data analysis firm GlobalData.
