In 2023, approximately an independent pharmacy closed every day, and similar figures are expected for this year according to the National Community Pharmacist Association.
Rite Aid, which has filed a balance sheet twice in two years, will potentially close tens of additional locations.
The pharmacy chain, which closed hundreds of its locations during its first bankruptcy procedure, should now close 47 stores due to various factors, including financial underperformance and the lack of interest of potential buyers. The company has already sold or closed 29 retail locations and concludes agreements to sell the limitation files of 63 additional stores.
This is a subject of approximately 2023, when the company has exploited thousands of locations in the United States since then, the company responsible for debt has considerably reduced the size of its footprint in the context of its recovery strategy.
Rite Aid is deposited for bankruptcy for the second time in less than 2 years
Rivals CVS and Walgreens have also launched closures in recent years, because industry is straight to the right. According to George Hill, Managing Director and Senior Analyst in Actions Research at Deutsche Bank, the industry looked at continuous growth and capacity building in the pharmacy space, which, according to Hill, “did not necessarily have a meaning”.
Customers in a Rite Aid store in New York. (Bing Guan / Bloomberg via Getty Images / Getty Images)
Hill said that “industry seemed to increase footprints And locations a little faster than the need for pharmacies increased. “”
Sarah Foss, head of Legal At Debtwire, told Fox Business that there is a “limited market for the precious active workers of Rite Aid, as they can generally only be sold to an approved and registered pharmacy, the company declared that it had a significant interest on the part of potential buyers.”
Rite aid to close hundreds of bankrupt stores: report
This is the key, according to Foss, which noted that “long and elaborate sales process could be the death knell for Rite Aid because the value of the company’s assets can deteriorate quickly.”
This could especially if the customers of the pharmacy choose to go elsewhere during this process, added Foss.
A client in a Rite Aid store in New York. (Bing Guan / Bloomberg via Getty Images / Getty Images)
Foss said that the sales process itself should occur at Lightning Speed with an auction set at the latest on May 14 for pharmacy assets and June 20 for the rest of the AID Rite assets. The approval of the bankrupt sales court should occur about a week later.
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“A process of auction and sale approved by the court inside bankruptcy protections can offer several advantages from the point of view of the buyer and the seller in this type of situation, allowing an accelerated sales transaction in which buyers can buy free assets and out of privileges, complaints and overlaps in a transparent process,” added Foss.
Rite Aid, which has filed a balance sheet twice in two years, will potentially close tens of additional locations. (Michael M. Santiago / Getty Images)
Rite Aid marks the 14th company to deposit Chapter 11 for the second time since the beginning of 2024 and is the fifth in 2025.
