In a pivotal move to stay afloat, discount retailer Big Lots, which filed for bankruptcy protection in September, has reached a new agreement to keep its stores and distribution centers operational. The deal, announced on Friday, sees Big Lots being acquired by Gordon Brothers Retail Partners, a firm specializing in assisting distressed businesses.
As part of the acquisition, Gordon Brothers will transfer Big Lots’ stores and distribution centers to other retailers. Notably, Variety Wholesalers Inc., which operates more than 400 discount stores in the Southeast and Mid-Atlantic, is set to purchase between 200 and 400 Big Lots locations. These stores will continue to operate under the Big Lots brand. Additionally, Variety Wholesalers plans to acquire up to two of Big Lots’ distribution centers.
Big Lots President and CEO, Bruce Thorn, highlighted the agreement’s importance in preserving jobs, maximizing the company’s estate value, and ensuring the continuity of the Big Lots brand. He expressed his appreciation for the dedication and resilience of employees nationwide during this challenging time.
The bankruptcy filing, stemming from the impact of inflation and rising interest rates, severely affected consumer spending, particularly on key items such as home and seasonal goods. Initially, Big Lots had planned to sell its assets and operations to private equity firm Nexus Capital Management. However, a breakdown in talks with Nexus by December 20 led to Big Lots’ collaboration with Gordon Brothers to initiate going-out-of-business sales at its 869 locations across the U.S.
This strategic acquisition not only secures the future of many stores but also positions Big Lots to emerge from bankruptcy with a more sustainable operational model, despite the turbulent market conditions.
