Rite Aid returns to bankruptcy protection as it seeks to sell most assets

By TOM MURPHY Associated Press Rite Aid is again seeking bankruptcy protection as the struggling drugstore chain says it will try to sell substantially all of its assets The company commented Monday that its stores will remain open as it returns to Chapter bankruptcy proceedings The company reported it will work to ensure that customer prescriptions are transferred to other pharmacies as it goes through the sale process The drugstore chain has lined up from particular of its lenders billion in new financing which help fund it through the sale and bankruptcy proceedings The company initially filed for bankruptcy protection in October with plans to sell parts of its business and restructure The company ran more than stores in states before the filing Rite Aid reported then that its initial voluntary Chapter filing would allow it to slash debt and resolve litigation The company sold its relatively small pharmacy benefits management business Elixir Solutions for around million Rite Aid emerged from Chapter nearly a year later as a private company The drugstore chain announced in a announcement that it came out of the process stronger with a rightsized store footprint more efficient operating model significantly less debt and additional financial support Rite Aid s creditors took ownership of the chain which shrank to stores in states according to its website A spokeswoman revealed in March that the company was laser focused on its retail pharmacies including restocking its stores But in early May empty white shelves dotted a store that sits a scarce miles from Rite Aid s corporate headquarters in Philadelphia The only rolls of wrapping paper in the store were various Christmas-themed offerings that leaned next to empty shelf space beneath a sign advertising Great Value The location also had a limited selection of profitable beauty products and drugstore staples such as Qtips and cotton balls Retail analyst Neil Saunders reported such a look encourages shoppers not to return They re actively pushing customers away explained Saunders managing director of the consulting and statistics analysis firm GlobalData Rite Aid was attempting to turn around its business in a tough circumstances for drugstores Major chains and independent pharmacies have been closing stores and struggling with several challenges Prescription profitability has grown tight The chains also are dealing with increased theft court settlements over opioid prescriptions and shoppers who are drifting more to online shopping and discount retailers Walgreens which has more than six times as various stores as Rite Aid agreed in March to be acquired by the private equity firm Sycamore Partners Philadelphia-based Rite Aid was founded in in Scranton Pennsylvania as Thrif D Discount Center The company had struggled with debt posted annual losses for several years and was cutting costs and closing stores well before its initial bankruptcy filing Rite Aid also explored sale offers Walgreens attempted to buy it for about billion a decade ago when Rite Aid ran more than stores But the larger drugstore chain eventually scaled back its ambition and bought less than half that total to get the deal past antitrust regulators In Rite Aid called off a separate merger with the grocer Albertsons Jonathan Poet contributed to this analysis from Philadelphia The Associated Press Medical and Science Department receives aid from the Howard Hughes Curative Institute s Science and Educational Media Group The AP is solely responsible for all content