Wanted: A Buyer for Rite Aid
Rite Aid Corp. appears in need of some aid, again. Following a Bloomberg report that the pharmacy chain is laying off staff and allegedly headed to bankruptcy court for the second time in less than two years, the company announced that it is actively pursuing a sale of all of its assets.
In a news release published on May 5, Rite Aid confirmed that it has started voluntary Chapter 11 proceedings to speed a sale. In addition, the company reported that it has secured $1.95 billion in new funding from existing lenders to help attract a buyer or buyers.
While the M&A activity gets underway, stores will remain open. Rite Aid emphasized that customers can still access pharmacy services and products both in stores and online.
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CEO Matt Schroeder said that the embattled retailer is working diligently to keep the business viable. “For more than 60 years, Rite Aid has been a proud provider of pharmacy services and products to our loyal customers. While we have continued to face financial challenges, intensified by the rapidly evolving retail and health care landscapes in which we operate, we are encouraged by meaningful interest from a number of potential national and regional strategic acquirors. As we move forward, our key priorities are ensuring uninterrupted pharmacy services for our customers and preserving jobs for as many associates as possible,” he remarked.
He also voiced gratitude to Rite Aid team members. “I will be forever grateful to our thousands of associates for their commitment to Rite Aid and its mission, and I thank our entire team – from store associates to corporate employees – for their dedication to our customers and our company,” Schroeder declared. “With their support, we have played a critical role in supporting the healthcare needs of countless Americans across the communities that we are honored to serve.”
The U.S. Bankruptcy Court for the District of New Jersey will review the case. Rite Aid also reported that it is seeking authorization to support its operations during the process, including the continued payment of employee wages and benefits.
Rite Aid first filed for bankruptcy in 2023 and, in the ensuing months, closed several stores and restructured its organization. The chain emerged from bankruptcy last fall as a private company and tapped Schroeder for the CEO role.
Philadelphia-based Rite Aid operates approximately 1,700 retail pharmacy locations across 16 states. The company is No. 26 on The PG 100, Progressive Grocer’s 2024 list of the top food and consumables retailers in North America.
