According to reports, Rite Aid is negotiating a bankruptcy plan with creditors that would include closing a substantial portion of its more than 2,100 drugstores, according to people familiar with the talks.
The reports say Rite Aid has proposed to close roughly 400 to 500 stores in bankruptcy, and either sell or let creditors take over its remaining operations.
The drug retailer faces more than $3.3 billion in debt and the company, who’s competitors include larger drugstore retailers Walgreens and CVS, plans to conduct an auction process to sell its Elixir pharmacy unit and other valuable parts of the business, the people said.
Rite Aid also faces a multitude of opioid lawsuits which have been consolidated into multidistrict litigation in Ohio. The company also faces similar cases pending in state courts that allege it contributed to the opioid epidemic. Rite Aid has asked a court to dismiss the Justice Department’s lawsuit and denied the allegations that it filled unlawful opioid prescriptions.