Rite Aid's closures continue to impact the Sacramento region, with news of the pharmacy chain's decision to close its distribution center in Woodland permanently.
The company notified employees on January 23 that the facility, situated at 1755 East Beamer Street, would cease operations on March 4.
Woodland Rite Aid Closure: 241 Jobs Lost, Severance Provided
Rite Aid's Woodland location on East Beamer Street will see 241 job losses. Employees staying until the end of their "transition period" will receive severance packages, outplacement support, and health insurance, stated Alicja Wojczyk, a Rite Aid spokeswoman.
Operations will shift to a Lancaster distribution center, a tough but necessary decision after a thorough analysis of Rite Aid's distribution network, Wojczyk explained. The Sacramento Business Journal broke the news of the closure.
Rite Aid has been closing unprofitable stores in the Sacramento area since 2022, according to previous reports by The Sacramento Bee.
So far, at least 11 Rite Aid stores have closed in the capital region. As of December, The Bee reports 16 stores remain in the Sacramento area.
Rite Aid is not closing its doors but is filing for bankruptcy. According to the bankruptcy filing, the company reported losses of approximately $2.9 billion over the last six years.
Rite Aid has shut down nearly twelve stores in the Sacramento area to close 150 "underperforming" stores nationwide. These closures are part of Rite Aid's restructuring efforts after filing for Chapter 11 bankruptcy in October 2023.
Rite Aid Initiates Chapter 11 Bankruptcy
In a significant move on October 15, 2023, Rite Aid and its subsidiaries, including those housing the Elixir pharmacy and benefits business, filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the U.S.
Bankruptcy Court for the District of New Jersey. Notably, Elixir Insurance stands exempt from this bankruptcy process.
This court-supervised procedure serves several purposes. Firstly, it aims to finalize and secure consensus for the agreement in principle reached with certain senior secured noteholders.
Additionally, it seeks to expedite the optimization of the company's store footprint. Moreover, it intends to facilitate a proposed transaction for acquiring Elixir Solutions by MedImpact Healthcare Systems, Inc., subject to a court-approved marketing process.
Furthermore, it endeavors to secure additional liquidity and to resolve litigation claims equitably.
Despite these financial challenges, Rite Aid remains committed to providing exceptional healthcare products and services through its retail and online platforms, ensuring continued support for its nearly one million daily customers.
According to the website, the company is taking decisive actions to fortify its position while ensuring the continued provision of essential products and services to our valued customers.
An agreement, in principle, has been reached with certain financial stakeholders on the terms of a financial restructuring plan. This plan will expedite Rite Aid's ongoing business transformation efforts. Implementing the proposed restructuring plan is expected to result in significant debt reduction, enhanced financial flexibility, and the ability to execute crucial initiatives.
Consequently, Rite Aid has commenced a voluntary court-supervised process under Chapter 11 of the U.S. Bankruptcy Code.
Throughout this transitional phase, Rite Aid maintains its unwavering focus on delivering top-notch healthcare products and services to improve the health outcomes of the nearly one million customers served daily.
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