Big Lots, with six Central Mass. locations, plans to close some stores amid bankruptcy
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Big Lots' Fitchburg location located at 353 John Fitch Hwy.
Ohio-based Big Lots, which has half a dozen locations around Central Massachusetts, has filed for voluntary Chapter 11 bankruptcy as the discount retailer has entered into a sale agreement to be acquired by Nexus Capital Management LP, an investment firm out of California.
As part of the company’s sale process, Big Lots plans on closing a number of its retail locations, according to a Monday press release. It didn’t specify which stores would close.
The retailer operates six locations throughout Central Massachusetts in Ashland, Auburn, Fitchburg, Gardner, Milford, and Webster.
Though Big Lots said its underlying performance has been improving, the impacts of high inflation and interest rates coupled with a decrease in customer spending on the revenue-heavy categories of home and seasonal products have negatively affected business.
“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," Bruce Thorn, president and CEO of Big Lots, said in the release.
Big Lots has procured commitments for $707.5 million in postpetition credit from current leaders which is expected to provide sufficient financing to support the company during the transaction, pending court approval. In addition, Big Lots has filed several customary motions in order to continue paying employees and critical vendors.
Big Lots is utilizing Davis Polk & Wardwell as legal counsel, Guggenheim Securities as financial advisor, AlixPartners as restructuring advisor, and A&G Real Estate Partners as real estate advisor; all firms based in New York. International law firm Kirkland & Ellis is serving as legal counsel for Nexus.
The acquisition is subject to higher or otherwise better offers, court approval, and other conditions, according to the release. Should Nexus be chosen as the winning bidder, the transaction is expected to close during the fourth quarter.
Mica Kanner-Mascolo is a staff writer at Worcester Business Journal, who primarily covers the healthcare and diversity, equity, and inclusion industries.
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