On September 9, 2024, Big Lots, Inc. filed for Chapter 11 bankruptcy protection in the United States Bankruptcy Court in Delaware.
At the time, Big Lots had entered into an asset purchase agreement with an affiliate of Nexus Capital Management LP (“Nexus”), which had agreed to acquire Big Lot’s assets and operations. Today, Big Lots announced it would not be able to close the sale with Nexus. Coupled with Big Lots’ default under its bankruptcy financing agreements and failure to timely pay all post-bankruptcy obligations to vendors and landlords, the reorganization prospects for Big Lots remained grim.
As a result, Big Lot will be pivoting to Going Out of Business Sales to protect the value of its bankruptcy estate. As such, it is likely that most leases will be rejected through the bankruptcy proceeding, although the possibility remains of leases being sold piecemeal and/or another going concern transaction being considered.
If you are a landlord or trade creditor of Big Lots or one of its other brands, it is important to know your rights now.
