(MEMPHIS) Discount chain Fred’s is joining the growing list of retailers shuttering stores amid slumping sales.
The Memphis-based company announced Thursday that it would close 159 under performing stores by the end of May with “going out of business” sales starting Thursday as it looks to reduce its store footprint and “evaluate strategic alternatives.”
The announcement affects stores in Mena and 18 other locations in Arkansas.
The retailer said in a statement that it retained investment banking advisory firm PJ Solomon to assess its options “to maximize value” and hired liquidation firms Malfitano Advisors and SB360 Capital Partners “to help manage the process and ensure a seamless experience for customers.”
When companies announce they are considering “strategic alternatives,” it often involves a potential sale or restructuring.
The closing stores represent nearly 29% of Fred’s 557 stores and are located in 13 states, with Mississippi, Alabama, Georgia and Tennessee losing the most stores.
Sales at Fred’s stores open at least a year fell 4.9% in the first nine months of 2018, compared with a year earlier.
In 2017, a deal for Fred’s to acquire hundreds of Rite Aid or Walgreens stores collapsed when a mega-merger between the pharmacy giants deteriorated.
Months later, Fred’s announced it was considering “strategic transactions and alternatives for certain non-core assets,” including real estate and specialty pharmacy business.
Last September, Fred’s reached an agreement to sell the pharmacy patient prescription files and related pharmacy inventory of 179 Fred’s stores located across 10 southeastern states to Walgreens for $165 million.