Discount retailer Big Lots has filed for Chapter 11 bankruptcy protection and plans to sell the business and assets to a private equity firm.
Big Lots cited high inflation and interest rates as the reason for filing, saying that consumers are not buying as many home and seasonal products, two categories that the company invests in, The Associated Press reported.
Sales have declined at established locations over the past nine quarters, FactSet found.
Big Lots said performance had improved but still the board decided to sell the company to Nexus Capital Management or whoever the highest bidder is at the end of the court-supervised auction calling the management company a “stalking horse bidder.”
The company has $707.5 million to continue operations and get through the sale, Reuters reported.
Stores and the website will remain open during the sale, but some locations will close. Big Lots has already started closing about 300 locations, but more could be announced, CNN reported.
At the end of last year, there were almost 1,400 Big Lots in 48 states, the AP reported. It has about 30,000 employees, according to Reuters.
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