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Five months after filing for bankruptcy — its second Chapter 11 in just eight months — Rite Aid has closed all of its locations, according to a notice on its website.
At the time of its filing in May, the drugstore retailer ran about 1,275 stores and three distribution centers in 15 states, employing about 24,500 people. The company blamed its most recent troubles on the retail side of its stores, though its debt load dragged down the entire operation, according to analysts.
There has been little to no interest in acquiring Rite Aid’s entire enterprise. CVS, Walgreens and others have taken over about 1,000 Rite Aid stores since this year’s bankruptcy filing, and Dollar Tree is snapping up a few unexpired leases. Through the Rite Aid website, customers can trace where their prescriptions have been transferred, though many likely took that step themselves months ago, according to Sarah Foss, head of restructuring at Debtwire. This in turn likely drained its resources, she said earlier this year.
Otherwise, the company described a confluence of factors that sent it back to bankruptcy court in a short time. That included struggling to compete with lower-priced household essentials and vendor reluctance to ship except under strict terms following its 2023 bankruptcy. Promised capital also failed to materialize.
“These setbacks created a perfect storm for Rite Aid,” Marc Liebman, managing director at Alvarez & Marsal North America and the retailer’s chief transformation officer, said in court filings.
Rite Aid and Liebman didn’t immediately return requests for comment.