Rite Aid, once a cornerstone of American pharmacy retail, is now accelerating its retreat from the marketplace. The company has announced plans to shutter an additional 150 stores, deepening the impact of its second Chapter 11 bankruptcy filing in less than two years. As Rite Aid navigates its complex Chapter 11 case, industry experts anticipate further store closures, leaving many to wonder what remains of the once-ubiquitous chain.
Rite Aid’s Store Closures Are Mounting
Rite Aid, the struggling drugstore chain now operating as New Rite Aid LLC, filed for Chapter 11 bankruptcy for the second time on May 5th. Since then, the company has submitted three separate notices to the U.S. Bankruptcy Court for the District of New Jersey, requesting permission to close a total of 361 stores and liquidate their assets.
The closures have come in waves:
- The initial notice and a follow-up on May 9th accounted for 210 store closures.
- A second notice followed on May 15th.
- Most recently, a third notice filed on May 23rd proposed the closure of 151 more stores.
The first set of closures affected stores in 12 states, with the largest impacts in:
- Pennsylvania (133 stores)
- California (25)
- Oregon (17)
- Washington (8)
- New York (7)
- Other states included New Hampshire, Virginia, Connecticut, Maryland, New Jersey, Delaware, and Massachusetts.
The latest batch of 151 stores includes:
- Pennsylvania (44 stores)
- California (34)
- New York (30
- New Jersey (14)
- Virginia (8)
- Delaware (5)
- Washington (5)
- Idaho (4)
- Maryland (4)
- New Hampshire (3)
Rite Aid Expected to Shut Down All Remaining Stores
New Rite Aid is likely to close all of its approximately 1,240 stores before its ongoing bankruptcy case concludes. The company is expected to file several more notices with the court to finalize these closures.
On May 9th, Judge Michael B. Kaplan approved an interim order allowing Rite Aid to begin closing both initially identified and newly added store locations. Anyone wishing to object must submit their concerns by May 30th, ahead of a final court hearing on June 6, when all proposed closures will be reviewed.
Rite Aid Offloads Prescriptions to Competitors
In addition to shutting down stores, Rite Aid has also started offloading its prescription business. On May 21st, the court approved a deal allowing the company to sell prescription files from 625 stores across 15 states to CVS. CVS also purchased 64 physical Rite Aid locations in Idaho, Oregon, and Washington.
Rite Aid has also received approval to sell prescriptions from other stores to Walgreens, Albertsons, Kroger, Giant Eagle, and other pharmacy operators as part of its asset liquidation strategy.
Is a Comeback Still Possible for Rite Aid?
A full-scale comeback for Rite Aid seems highly unlikely. The company’s plans to close all remaining stores and sell its prescription files to competitors indicate a systematic dismantling of its retail operations rather than a restructuring aimed at future growth.
Although Rite Aid may try to emerge from bankruptcy as a leaner entity or shift to a new business model, the sale of key assets, especially prescriptions and physical stores, leaves little groundwork for a traditional recovery. Without a retail presence or a loyal customer base, the company’s future remains uncertain. For now, Rite Aid’s actions suggest it is exiting the pharmacy landscape rather than preparing for a comeback.
Source: TheStreet