The troubled retailer continues to shock communities with successive waves of closures, further thinning its presence on the retail landscape. Over the course of the past week alone, they’ve announced the shuttering of an additional 30 locations, adding to the string of closures that have characterized their recent operations.
Since the declaration of bankruptcy in October 2023, Rite-Aid has been diligently pruning its store count. Documents linked to the retail chain’s operations reveal an additional 66 locations earmarked for closure since the start of April. Notably, the most recent updates from April 9 and April 16 indicate that six more California-based stores have been slated for closure, marking a continuing trend since our last report on Rite-Aid.
Rite-Aid’s Reputation Takes Another Hit
A significant portion of Rite-Aid’s financial troubles stems from legal battles over allegations of illicitly filling prescriptions for opioid painkillers. Just prior to the bankruptcy filing, the Wall Street Journal estimated the company’s debt at over $3.3 billion. However, recent reports from Bloomberg suggest that figure may soar closer to $8 billion.
Reports Suggest Rite Aid to Seek Bankruptcy Protection
Given the substantial debt, much of which is linked to their involvement in the opioid crisis, the revelation that the company plans to award its new CEO a $20 million package upon emerging from bankruptcy has sparked controversy. Bloomberg reports that in addition to the proposed “success fee” for Jeffrey Stein, he’s slated to receive a monthly salary of $300,000. What’s striking is that Stein has only occupied the CEO position for a mere seven months.
The move to compensate Stein at such a level has drawn sharp criticism from creditors, particularly in light of the harm inflicted by Rite-Aid’s actions during the opioid crisis. Bloomberg highlights the disparity, noting that Stein’s salary would surpass that of other executives navigating bankruptcy proceedings by more than fourfold.
Discontent Among Creditors
The creditors, who lodged a complaint, express disgust at the notion of Stein receiving such substantial compensation, particularly in comparison to the thousands of individuals, families, and communities affected by Rite-Aid’s role in fueling the opioid epidemic.
Which California Locations Are Facing Closure?
With the recent addition of six stores listed in the April 9 document, Rite-Aid’s tally of closures in California climbs to 72. Following this latest announcement, we delve into the twelve locations previously marked for closure on April 2.
In dissecting the ongoing saga of Rite-Aid’s closures and financial tribulations, it’s evident that the challenges facing the retailer are multi-faceted and deeply entrenched. As the company navigates bankruptcy proceedings and grapples with the fallout from its past actions, the ramifications are felt not only within its corporate corridors but also reverberate throughout the communities it once served.
