Big Lots is set to close its remaining 963 stores after a deal to save the bankrupt retailer fell through. The company had announced in September that it was selling “substantially all” of its assets to private equity firm Nexus Capital Management. However, Big Lots stated Thursday that it “does not anticipate completing” the transaction.
As a result, the company is beginning “going out of business” sales at all of its remaining locations in the coming days. Despite this, Big Lots plans to continue exploring options to rescue the company, including negotiating with Nexus or another potential buyer, with hopes of finalizing a sale by early January.
Up to 555 employees are set to lose their jobs, including corporate staff such as the president and CEO, according to a layoff notice.
Big Lots CEO Bruce Thorn expressed in a press release, “We all have worked extremely hard and have taken every step to complete a going concern sale. While we remain hopeful that we can close an alternative going concern transaction, in order to protect the value of the Big Lots estate, we have made the difficult decision to begin the going out of business process.”
The company cited several economic challenges for its bankruptcy, including high inflation and interest rates, which have shifted consumer buying habits. Customers are focusing more on value, but not necessarily lower prices. This shift has impacted dollar stores, while sales at Walmart and Amazon continue to rise.
Big Lots has been closing hundreds of stores since the start of the year. At its peak, the retailer had over 1,400 locations across the United States.
Before filing for Chapter 11 bankruptcy protection, Big Lots had expressed “substantial doubt” about its ability to continue operations. A regulatory filing indicated a “significant likelihood” of defaulting on a 2022 loan, which could jeopardize the company’s efforts to survive after 57 years in business.