(WJET/WFXP) — Popular discount retailer Big Lots has filed for Chapter 11 bankruptcy protection. As part of the bankruptcy and restructuring, 295 stores have already begun to shut down in what the company says is “optimizing our store footprint.”
The company also says approximately 250 more locations will be completely closed no later than Jan. 15, 2025.
The retailer has 1,389 locations across 48 states (only Alaska and Hawaii are without stores). The Columbus, Ohio-based company began in 1967.
The retailer will continue to honor gift cards and store credit cards.
“Though the majority of our store locations are profitable, we intend to move forward with a more focused footprint to ensure that we operate efficiently and are best positioned to serve our customers,” Big Lots President and CEO Bruce Thorn said in a press release. “To accomplish this, we intend to use the tools afforded by this process to continue optimizing our store fleet in an orderly manner.”
The bankruptcy comes just months after the company warned in a U.S. Securities & Exchange Commission (SEC) filing that between 35 and 40 locations could shutter this year.
Big Lots has entered into a sale agreement with Nexus Capital Management LP in a “Stalking Horse Bid,” the initial bid on the company that sets the baseline against other buyers’ offers. If the auction receives bids lower than the “Stalking Horse” price or fails to attract other bidders, the “Stalking Horse Bid” is normally declared the winner. The deadline to submit bids is Oct. 15.
According to court documents, the company currently holds just under $3.1 billion in debt owed to anywhere from 5,001 to 10,000 creditors. They also state that the company currently holds $3.18 billion in assets.
As is the case with the growing number of companies filing for bankruptcy, the retailer has been hit hard by recent macroeconomic factors, including high inflation and interest rates. The company also notes the major shift in customer spending trends with many customers either delaying or avoiding discretionary spending.
