Retail News

In the Rite Aid, DIP case, the Court approved the Debtors restructuring plan. Reports indicate Rite Aid plans to emerge from bankruptcy in about a month with about 1,300 remaining locations.

The Debtors will use the time to fine tune some of the details in its bankruptcy deal, including a last-minute change spurred by the U.S. Supreme Court ruling in the Purdue Pharma bankruptcy. The Supreme Court rejected a bankruptcy plan for Purdue Pharma that would have allocated billions of dollars from members of the Sackler family to combat opioid addiction in exchange for shielding them from civil lawsuits over their alleged role in fueling the drug epidemic. The Supreme Court’s decision marks a victory for the minority of opioid victims who voted to reject the settlement plan because they want to continue pressing lawsuits against the Sackler family members who own Purdue, and a loss for the majority of opioid victims and state and local governments who voted to accept it. The ruling weakens the ability of corporations and their insiders to use bankruptcy to resolve mass litigation alleging they harmed consumers.

To comply with that ruling, Rite Aid will work to ensure that its own deal's legal protections for non-debtors, such as Rite Aid's lenders and CEO, will have the consent of anyone who has a legal claim against those parties.

An attorney representing opioid creditors said that 22,000 individuals who had filed personal injury opioid claims in the Rite Aid bankruptcy stood to receive between $250 and $500 each. The settlement payments, though modest, are a victory for opioid claimants because of Rite Aid's high debt and dire financial troubles, the attorney said.

The Debtors identified an additional 30 stores for closure, bringing the total of announced closures to 590.

Walgreens Boots Alliance (WBA) announced it is evaluating its store portfolio, which could result in the closure of hundreds or even thousands of stores. Commenting on the announcement, CEO Tim Wentworth said, “Currently, 75% of our U.S. stores contribute roughly 100% of our segment AOI (adjusted operating income). For the remaining 25% of the stores in our network, which are not currently contributing to our long-term strategy, changes are imminent. To start, we are finalizing a multi-factor store footprint optimization program, which we expect will include the closure of a significant portion of these underperforming stores over the next three years. For the remaining portion of this cohort, we are taking action to improve profitability.”

As part of a multi-year transformational cost management program announced in 2018, the Company has already closed 673 U.S. stores, plus another 581 in the UK, through May 31, 2024, and over the past decade has closed about 2,000 stores.

The Jim Pattison Group has acquired Save Mart from Kingswood Capital Management; Kingswood had only acquired the Company in March 2022. The new owners, a diversified holding company, are no strangers to the grocery business. Its Food Group division operates one of the largest grocery wholesale businesses in Canada, which serves more than 2,000 independent retailers. It also operates several retail banners in Canada, including Save-On Foods, which is one of the largest food retailers in Western Canada, as well as Quality Foods, Choices Markets, and others. Though Save Mart represents Pattison’s largest investment in the U.S. by far, it also operates Roth’s Fresh Markets, a nine-store retailer serving Oregon’s mid-Willamette Valley, which it acquired in 2021.

Amazon opened its second Amazon Fresh store in New Jersey, located in Eatontown. The new store, at 35,000 square feet, includes a selection of prepared foods, international condiments and sauces, alongside typical grocery offerings. The store carries items from more than 75 local brands as well as Amazon private brands. There are now 42 Amazon Fresh locations in eight states.

Amazon Fresh is reportedly preparing to open a store this summer in Alexandria, VA. 

Conn’s is preparing for a potential bankruptcy filing “within weeks,” according to sources. This stems from operational reversals and difficulty integrating its acquisition of W.S. Badcock LLC, which it bought from Franchise Group Inc. only half a year ago.

In the Express, DIP case, the Debtors notified the Court of the closing of the sale of most of their tangible and intangible property to The Phoenix JV on June 21. Phoenix is a joint venture formed by WHP Global, Simon Property Group and Brookfield Properties.

H&M has closed 80 net stores over the last year and ended the 1H24 period with 4,319 locations. In FY24, the Company plans to close 160 stores, primarily in established markets, and open 100, for a net decrease of 60 stores. 

In the Mountain Sports, DIP case, the Court approved on an interim basis the Debtors request to engage Hilco as a liquidator for all 27 Bob’s Stores locations and 15 of the 23 EMS locations.

LL Flooring announced it has received several preliminary bids and is in several second-round bids in connection with the sale of its Sandston, VA, distribution center. The Company expects to move forward negotiating with certain bidders.