Just weeks after Big Lots announced the closure of over 100 locations, the discount chain has filed for bankruptcy and says it will sell off its assets to another company, blaming “high inflation and interest rates” that impacted their “core customers,” who “curbed their discretionary spending.”
In a statement issued to investors on Monday, September 9, Big Lots Stores, Inc. says it has filed for bankruptcy to facilitate an agreement with an “affiliate of Nexus Capital Management LP,” which will acquire “all of the company’s assets and ongoing business operations.”
Nexus Capital Management was founded by Michael Cohen and Damian Giangiacomo. The business is headquartered in Los Angeles, California. The company also has investments in Dollar Shave Club, FTD/ProFlowers, TOMS, and several other well-known companies.
According to the statement, Big Lots is entering bankruptcy in the U.S. Bankruptcy Court for the District of Delaware.
“The actions we are taking today will enable us to move forward with new owners who believe in our business and provide financial stability, while we optimize our operational footprint, accelerate improvement in our performance, and deliver on our promise to be the leader in extreme value,” said Bruce Thorn, President and Chief Executive Officer of Big Lots.
The company says that it was “adversely affected by recent macroeconomic factors such as high inflation and interest rates that are beyond its control.”
While the company says that its “performance has been improving,” its board determined that selling the company through a “court-supervised sale process” was the “best path forward to maximize value and ensure continued operations.”
As part of the court-supervised sale process, the company says it will assess its “operational footprint,” which will include closing additional store locations. It says it will also “continue to evaluate and optimize its distribution center model.”
No additional details were provided regarding which possible locations may be closed.
Previously, the company announced plans to close at least 26 stores in Florida. On the company’s website, stores that are closing show “Closing This Location” on their webpages.
Locations scheduled to close in Florida include those in Boca Raton, Bonita Springs, Boynton Beach, Bradenton, Clewiston, Coconut Creek, Daytona Beach, Destin, Fort Myers, Hallandale, Hollywood, Miami (Fontainebleau), Miami Lakes, Naples, Orange Park, Orlando (3), Plantation, Pompano Beach, Port Richey, Royal Palm Beach, Sarasota, Stuart, Tampa, and Tarpon Springs.
The stores in Ocala and surrounding areas were not included on the closure list.
Big Lots currently operates locations in Ocala at 2653 E Silver Springs Boulevard, 6851 SE Maricamp Road, and 8602 SW Highway 200.
Currently, Big Lots operates approximately 1,389 stores across 48 states. Around 106 of those stores are located in the state of Florida.
According to a filing with the U.S. Securities and Exchange Commission, the company previously warned that it would likely close at least three dozen locations this year. That number grew to over 100 in the weeks that followed.