Preparations are underway for 'liquidation sales' at the remaining outlets of Big Lots.
The corporation initially declared back in September that they were transferring "largely all" of their assets to private equity firm Nexus Capital Management, but as of a statement made on Thursday, Big Lots expresses no expectation of finishing this deal.
Consequently, Big Lots will be initiating their "closing down" sales at all the remaining outlets in the near future. Nevertheless, they intend to investigate further possibilities to rescue the company, such as renegotiating with Nexus or a different buyer, with the objective of wrapping up a sale by early January.
As revealed in a press release by CEO Bruce Thorn, "We've put in an immense amount of effort and taken every necessary step to finalize a 'going concern' sale. Although we remain hopeful that we can close an alternative 'going concern' deal, to safeguard the worth of the Big Lots estate, we've made the challenging decision to initiate the [closing down] process."
Big Lots attributes a few economic factors for their bankruptcy, including soaring inflation and interest rates causing shoppers to alter their spending habits. They're conscious of value — but not exclusively lower costs. Because of this, dollar stores have been experiencing difficulties, while sales at Walmart and Amazon have been skyrocketing.
Big Lots has been shutting down stores en masse since the beginning of the year. At its zenith, it operated over 1,400 locations across the USA.
Before the filing for Chapter 11 bankruptcy protection, Big Lots had announced having "substantial doubt" regarding their capacity to continue operations. A regulatory filing suggested the "probable likelihood" of a default on a 2022 loan, which may jeopardize the survival attempts for the 57-year-old retailer.
Despite the challenges, Big Lots is exploring options to save the company, such as renegotiating with Nexus or seeking a different buyer, aiming to complete a sale by early January. The business's financial struggles can be partially attributed to rising inflation and interest rates, which have impacted dollar stores negatively while boosting sales at Walmart and Amazon.
