Rite Aid has filed for chapter 11 bankruptcy protection. As of June 3rd this year, the company had $8.60 billion in debt and total assets of $7.65 billion. They have already secured $3.45 billion from lenders in order to aid in business restructuring. The company also hired Jeffrey S. Stein as CEO, Chief Restructuring Officer, and is now a member of the Board of Directors.
Rite-Aid will continue to close underperforming stores and transfer employees when possible and move customer prescriptions when necessary. The company closed approximately 150 underperforming stores last year and has closed over 250 this year. There is no word on which or how many stores the company plans to close as part of the bankruptcy filings.
Rite Aid has faced significant financial losses from lawsuits alleging that their pharmacies contributed to the opioid crisis in America. They have been accused of knowingly filling unlawful prescriptions for controlled substances. The company is planning to use this restructuring period to settle lawsuits and move forward with their business. It is unclear how these filings will affect the pharmacy market, which already saw a major shift this year when rivals Walgreens and CVS purchased Winn Dixie’s pharmacy business.
CSG will continue to monitor this developing story. CSG’s Drug Stores & HBC Chains database as well as our Custom division has the current locations and personnel for Rite Aid.
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