Big Lots' Bankruptcy Preparations
Recent reports indicate that Big Lots, a prominent discount home goods retailer, is gearing up to file for bankruptcy soon. The process is expected to involve a court-supervised sale of its stores, according to reliable sources.
Operational Continuity Under Chapter 11
Despite impending bankruptcy, Big Lots intends to keep its operations running under Chapter 11 protection. This strategy allows the company to restructure while still maintaining business activities. Currently, Big Lots is working to secure a stalking horse bid, a financial term meaning that this initial bid could be outbid by other parties if they present better offers.
Changes to Financial Reporting Timeline
In connection with these developments, the retailer recently announced a delay in releasing its second-quarter earnings. The earnings report, initially set for early September, has been pushed back to mid-September. Such changes underscore the company's ongoing financial challenges.
Partnership with Financial Advisors
To navigate this difficult period, Big Lots is collaborating with experts from AlixPartners and Guggenheim Partners. Their involvement is crucial in guiding the company through the bankruptcy and potential sale process.
Business Overview
Operating approximately 1,400 stores and employing over 30,000 individuals, Big Lots has been wrestling with diminishing sales over the past several quarters. This downturn in revenue has significantly impacted the company's financial stability.
Significant Stock Decline
Investor sentiment has been particularly negative, with Big Lots' stock price plummeting over 90% within the last year alone. Recently, the share prices saw a further decline of more than 22% during extended trading hours, highlighting the urgency of its financial situation.
Speculations of Bankruptcy
Prior to these recent developments, indications emerged that Big Lots was contemplating a bankruptcy filing. Reports suggested that the company might seek court protection in the near future, which has now materialized into actionable steps.
Company's Response
As of yet, Big Lots has not issued a statement concerning these recent events to the media. The lack of communication has left stakeholders keenly awaiting further information about the company's future.
Frequently Asked Questions
What is happening with Big Lots?
Big Lots is preparing to file for bankruptcy and is planning to sell its chain of stores under a court-supervised process.
Will Big Lots continue operations?
Yes, Big Lots intends to remain operational under Chapter 11 bankruptcy protection while it restructures.
What affected Big Lots' financial status?
Big Lots has been experiencing declining sales and significant stock price decreases, leading to its current financial challenges.
Who is assisting Big Lots during this period?
The company is working with financial advisors from AlixPartners and Guggenheim Partners to navigate the bankruptcy and sale processes.
What is a stalking horse bid?
A stalking horse bid is an initial bid on a bankrupt company's assets that can be outdone by other bidders, serving as a baseline offer.
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