The embattled retailer announced that it will close an additional 129 retail stores and hold clearance sales across all locations in an effort to refocus its product mix, simplify its store portfolio and repay debt. This is Fred’s fourth round of closings — the chain has closed some 300 stores during the past few months — and, when completed, will leave it with 80 locations, centered primarily around its distribution center in Dublin, Ga.
Fred’s said it may evaluate re-launching certain closed stores in the future under a new operating model with an updated assortment. The company expects the proceeds from the inventory clearance sales will be used to repay outstanding indebtedness under its revolving credit agreement.
“While it is never easy to make decisions that impact our valued employees and customers, this initiative represents another necessary step in our continued efforts to stabilize our business by simplifying our store portfolio and product assortment,” said Fred’s CEO Joseph Anto.
All pharmacies (including the 69 within the 129 stores in the newest round of closings) will remain open and continue to fulfill prescriptions as it continues to pursue the sale of its remaining pharmacy locations and opportunities to monetize pieces of its real estate portfolio.
Fred’s has partnered with Malfitano Advisors, LLC and SB360 Capital Partners to help manage the clearance sale process.