(Reuters) – U.S. drugstore chain Rite Aid said on Tuesday it will operate as a private company after successfully completing its financial restructuring and emerging from Chapter 11 bankruptcy.
The pharmacy used its bankruptcy to close hundreds of stores, sell its Elixir pharmaceutical benefits business, and negotiate settlements with its lenders, drug distribution partner McKesson (NYSE:) and other creditors.
The company said ownership of the company has been transferred to certain creditors of Rite Aid (NYSE: RTA), and all of the company’s existing common stock has been cancelled.
Rite Aid also said it has named CFO Matt Schroeder as CEO, succeeding Jeffrey Stein.
The company added that it has paid off about $2 billion of total debt and obtained about $2.5 billion in exit financing to support the business in the future.
In June, a U.S. bankruptcy judge approved Rite Aid’s restructuring plan, saying it saved the company from having to close and liquidate operations.
Rite Aid filed for Chapter 11 bankruptcy in October 2023, after reporting losses of $750 million on revenue of $24 billion for the fiscal year ending March 2023.
Before it filed for bankruptcy, Rite Aid faced 1,600 opioid-related lawsuits, including one filed by the federal government that alleged the company ignored red flags when filling suspicious prescriptions for the pain medication.
Rite Aid, which operated 2,000 pharmacies at the time of its bankruptcy, expects to emerge from Chapter 11 with a smaller retail capacity.
During its bankruptcy, Rite Aid closed all of its stores in Michigan and all but four of its stores in Ohio, saying the withdrawal from those states was necessary to maintain the company’s “financial and operational health.”
Rite Aid announced the closure of 160 stores in Michigan and 111 in Ohio in court filings between June and August.