Rite Aid to Close Hundreds of Stores

The drugstore is in talks with creditors after filing for bankruptcy.

September 25, 2023

Rite Aid is currently negotiating with creditors over the terms of a bankruptcy plan that includes liquidating a substantial portion of its drugstores, reports the Wall Street Journal.

With more than 2,100 stores, Rite Aid has proposed closing 400 to 500 stores in bankruptcy and either sell or let creditors take over the remaining operations, according to The Journal.

It was said that a group of bondholders would prefer to liquidate a larger number of stores, so the two sides are discussing the number of stores to be closed.

Additionally, the company plans to sell its Elixir pharmacy unit and other valuable parts of the business through an auction process, stated The Journal.

Rite Aid filed for bankruptcy in face of its more than $33 billion debt load and legal allegations concerning opioids. According to the Wall Street Journal, most of the federal opioid lawsuits have consolidated into a multidistrict litigation in Ohio. Additionally, the company is facing a civil lawsuit from the U.S. Department of Justice alleging that the company knowingly filled unlawful prescriptions for controlled substances.

In overall market trends, NACS reports that drug stores show a market decline while c-stores show market growth with a 1.5% increase from last year, as convenience and dollar stores become more prevalent.