On Sunday, Rite Aid, an American drugstore, filed for bankruptcy as the firm plans to close some of its stores across the United States as it suffers a decline in sales and opioid lawsuits.
In recent years, Rite Aid has struggled to keep up with bigger drugstore chains like CVS and Walgreens as it faces lawsuits concerning allegations that it aided in increasing the opioid epidemic.
Also, there have been rumours that the company plans to file for bankruptcy at the end of August due to the company having billions of dollars in debt, the decline in sales, and more than a thousand lawsuits from federal, state, and local lawsuits claiming that the company gave thousands of illegal prescriptions for painkillers.
What Does Chapter 11 Bankruptcy Protection Mean for Rite Aid?
The Chapter 11 bankruptcy protection that Rite Aid filed in New Jersey means that the company will continue in business as it works through restructuring its debts through a court-controlled process. The company said in a statement it released on Sunday that it has raised $3.45 billion in financing from lenders as it continues operating even as the firm files for bankruptcy.From the data, the last time the company filed a financial report was in June—-it also shows that the health business had $3.3 billion in debt when compared to the $135.5 million in cash it has available.
In the statement about the Chapter 11 filing, Rite Aid said it has plans to close some of its underperforming stores as part of its restructuring plan.
What to Know About Rite Aid Store
Rite Aid was founded in 1962 in Philadelphia and has been one of the country's largest pharmacy stores, with more than 2,000 stores in 17 states.Read more: https://www.investingport.com/rite-...e-firm-resorts-to-closing-some-of-its-stores/