Discount retail chain Big Lots announced Thursday that it will begin “going out of business” sales at all of its remaining locations after it was unable to reach an agreement with an investment firm.
“In parallel with these efforts, the company is preparing to begin closing sales at all remaining Big Lots stores in the coming days to protect the value of its equity,” the company said in a statement. statementwhich added that Big Lots will continue to “serve customers in-store and online, and provide updates as they become available.”
Big Lots CEO Bruce Thorn said in a statement that Big Lots attempted to complete the sale of the company to Nexus Capital Management but failed. He said that in the meantime, the company will try to close the deal with Nexus or another party early next month.
“We have all worked very hard and taken every step to complete a going concern sale,” he said. “While we remain hopeful that we can close a working alternative transaction, to protect the value of Big Lots’ equity, we have made the difficult decision to begin the process. [going-out-of-business] process.”
Big Lots, headquartered in Columbus, Ohio, operates more than 1,400 stores in 48 states. The company has closed several locations in recent months after filing for Chapter 11 bankruptcy after dealing with declining sales in recent quarters, which put pressure on its balance sheet.
Big Lots had listed its assets and liabilities in the range of $1 billion to $10 billion, according to a Delaware bankruptcy court filing, which showed creditors in the range of 5,001 to 10,000.
Under the previous deal that failed, Big Lots told the court that Nexus would act as a “stalking bidder” in a court-supervised auction process, adding that the deal would close in the fourth quarter of 2024 if it was deemed to Nexus was the winner. bidder. A stalking bid is used as an initial or minimally accepted offer that other interested bidders must beat if they want to purchase the asset or company.
Confirming that the company filed for Chapter 11 bankruptcy earlier this year, Thorn blamed economic factors such as higher-than-normal inflation and other pressure points. Customers have been forced to change their spending behavior due to inflation, which has been persistent since the COVID-19 pandemic, his company said.
“Prevailing economic trends have been particularly challenging for Big Lots as its largest customers reduced their discretionary spending in the home and seasonal product categories that represent a significant portion of the company’s revenue,” the company said in a statement in September.
The company’s shares have fallen more than 98 percent in the past year. Through Thursday, Big Lots shares were down another 7 percent, to about $0.09 per share. A year earlier, the stock was trading at about $7 per share.
Earlier this month, the U.S. Department of Labor released a report showing that U.S. consumer prices rose in November to their highest level in seven months. The consumer price index rose 0.3 percent last month, the biggest increase since April after advancing 0.2 percent for four straight months, the Labor Department’s Bureau of Labor Statistics said.
Reuters contributed to this report.
