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While rivals Walmart Inc., CVS Health Corp. and Walgreens Boots Alliance Inc. agreed to pay more than $13 billion combined to settle opioid lawsuits, Rite Aid never reached a similar accord before its bankruptcy filing put litigation on hold, Bloomberg News reported. The company told opioid plaintiff lawyers it didn't have the funds. And unlike drugmakers that have gone bankrupt, the retailer doesn’t expect it will wind up with any money to pay opioid victims. “Bankruptcy is perceived as a strategic tool that provides enormous leverage in negotiations with injured people,” said Melissa Jacoby, a law professor at University of North Carolina Chapel Hill. "It’s a real problem that bankruptcy is being used this way, even when a company has other financial problems.” Rite Aid’s restructuring talks have focused on how much it can afford to repay its secured creditors before either selling itself or reorganizing into a new company, immune from future opioid lawsuits. Last year, Rite Aid filed for Chapter 11 bankruptcy, listing debts of $8.6 billion, close to $1 billion more than the value of its assets at the time. The company got a new $200 million loan in Chapter 11 and continued access to an existing credit line from a group of its secured lenders after it agreed to bump up more than $3 billion of their old debt in the repayment line. Rite Aid is still trying to sell its retail business. But its back-up plan involves shedding a lot of debt, shutting down more than 600 stores and giving the remaining pharmacy business a fresh start. Mediated talks with the committee of mass tort claimants are ongoing, so their outcome could change if a deal is struck. But Rite Aid said in court papers as recently as Feb. 20 it doesn’t expect for there to be any money left for opioid plaintiffs after paying higher-ranking debts.

Home-fitness company BowFlex has filed for chapter 11 bankruptcy with a deal in hand to be acquired by specialty fitness retailer Johnson Health Tech, WSJ Pro Bankruptcy reported. BowFlex today said that it has secured a commitment for $25 million in debtor-in-possession financing that will allow the Vancouver, Wash., company to continue operating in a normal course and to fulfill customer orders during the bankruptcy process. Taiwan’s Johnson Health Tech will act as the stalking horse, or lead, bidder in a court-supervised auction for BowFlex with a bid of $37.5 million in cash for substantially all of the company’s assets. BowFlex said that multiple parties have indicated an interest in bidding for the company. Johnson Health Tech, whose fitness brands include Matrix, Horizon Fitness and Vision Fitness, operates more than 460 locations in Asia, Europe and the Americas. BowFlex said that it initiated the chapter 11 proceeding in the U.S. Bankruptcy Court for the District of New Jersey.

Crafts retailer Joann Inc. is considering a bankruptcy filing as soon as next week as part of a deal that would hand control of the company to lenders while allowing it to shed expensive debt, Bloomberg News reported. The company, which sells fabric and craft supplies and has around 850 stores in the U.S., has been holding confidential talks with its lenders as it seeks fresh capital to bolster its cash reserves. Discussions are ongoing and plans aren’t final, but the company is seeking to line up enough support from lenders that would allow it to exit chapter 11 quickly in what’s known as a pre-pack filing. Joann has struggled to maintain liquidity and manage inventory levels amid a challenging environment for retailers. It raised more than $34 million in a sale and leaseback deal for its Hudson, Ohio facility, but is contending with high interest expenses and required term loan payments, Moody’s Investors Service wrote in a note in January.

The NYSE American exchange has and intends to delist shares of Polished.com after the company said it plans to file for bankruptcy, MarketWatch.com reported. The New York Stock Exchange's regulatory arm has determined that the stock is no longer suitable for listing after the online retailer of home appliances said on Thursday that it has suspended operations. Polished.com said that it was unable to obtain additional financing after "working to reach a resolution with its lenders" and explored multiple alternative funding paths, and now intends to file for chapter 7 protection. NYSE said that the company can review the staff's determination to delist the stock and appeal if it chooses.

Macy’s said yesterday that it would vastly reshape its strategy and retail footprint, closing about 150 Macy’s stores over the next three years while expanding its upscale Bloomingdale’s and Bluemercury chains, the New York Times reported. The moves put the stamp of the company’s new chief executive, Tony Spring, on an effort to improve the profitability of the largest department store operator in the United States and stave off a potential takeover bid. It is the second major downsizing of the Macy’s chain since 2020 and will leave the company with 350 stores, slightly more than half the number it had before the pandemic. Macy’s called the stores it planned to close “underproductive locations” that accounted for 25 percent of the company’s overall square footage but just 10 percent of sales. The company said it expected to take in $600 million to $750 million by selling these stores and streamlining some of its warehouses. The company said that it would start notifying workers later that day at stores it planned to close. It plans to shutter roughly 50 stores this fiscal year and the rest by the end of 2026.

At least one lender to Express Inc. has approached the retailer to put aside a pool of money for expenses tied to a potential future bankruptcy filing, Bloomberg News reported. A demand to set aside so-called cash reserves, if enforced, could push Express into chapter 11 as it would eat into limited liquidity available for necessary payments to vendors, landlords and other parties, said the people, who asked not to be identified discussing private negotiations. Creditors have been growing increasingly antsy and considering whether to push the company to file for bankruptcy, Bloomberg previously reported. Express, which is burning through a short supply of cash as it attempts to fix troubled operations, is looking to avoid any move to fund reserves for as long as possible. The retailer lost over $150 million in three quarters through late October as it faced an escalating competitive threat from fast-fashion rivals. More of its major creditors would have to join the request in order for it to mandate action on the part of Express. Lenders to the retailer include Wells Fargo & Co., Bank of America Corp., Hilco Global and Gordon Brothers Group.

The Children's Place said on Friday it had received an offer for a $130 million loan that could help it stay afloat, after the ailing U.S. retailer announced earlier this week that Saudi Arabia's wealthy AlRajhi family had amassed a 54% stake in the company in the open market via its investment firm, Bloomberg News reported. Gordon Brothers Group, a firm that specializes in liquidating brick-and-mortar retailers, has provided a term sheet for the loan that is subject to due diligence and other conditions, The Children's Place said. The company added it hoped to finalize terms next month. The loan discussions come after Mithaq Capital, the AlRajhi family's investment firm, crossed into majority ownership of The Children's Place this week through open-market stock purchases, triggering a change-of-control provision in the company's prior $50 million debt package that required it to be refinanced.

Apparel retailer Express is preparing for a debt restructuring that could include filing for bankruptcy within weeks, WSJ Pro Bankruptcy reported. The Ohio-based retailer known for its affordable office wear has hired restructuring adviser M3 and law firm Kirkland & Ellis to consider how to restructure nearly $280 million of debt amid declining sales. Publicly traded Express is still trying to avoid filing for bankruptcy by restructuring debt outside of chapter 11, the people said. Whether that is successful will depend on its lenders agreeing to provide more liquidity or loosening repayment options. Express’s ability to avoid bankruptcy also hinges on whether vendors are willing to keep shipping goods without tightening payment schedules. Express shares fell 12% to close at $3.75 on Monday after the news of a possible bankruptcy filing. The shares were down 23% to $2.90 in after-hours trading, and are down about 98% since August 2021. Express, which operates more than 600 retail and outlet stores, has said the business has struggled because of higher interest rates, slower store traffic, lower consumer spending and increasing competition from other retailers selling similar clothing at a deep discount. Its inventory also isn’t in line with what customers demand, the company has said.

Off-price home goods retailer Big Lots Inc. has been seeking new financing as it grapples with years of losses and dwindling liquidity, Bloomberg News reported. The Columbus, Ohio-based chain has been reaching out to bankers and investors to assess market willingness to provide a new loan. A representative for Big Lots declined to comment on the financing effort, but said that the company has taken “significant actions to enhance our liquidity,” and “will continue to evaluate potential liquidity options.” The company’s shares fell as much as 5.9% to $5.24 after Bloomberg reported the financing effort. Big Lots runs about 1,400 stores but has been monetizing them in recent years to safeguard its cash pile. That leaves it with relatively few remaining assets to offer up as backing for potential new debt, according to its corporate filings. The discount retailer inked a sale and leaseback deal for a distribution center and 26 owned stores with affiliates of Blue Owl Capital in July for gross proceeds of $318 million, according to a prior statement.