Big Lots loyalists are devastated by company's latest troubles

It should be absolutely not any secret that Big Tons has been suffering from sales for the last two years, forcing the company to make major moves to remain afloat, resulting in its Chapter Eleven financial disaster filing on Monday.

Though drastic, the filing changed into to be expected after Big Tons announced it'd delay its Q2 earnings report free up on the intended publishing date of September 6.

Related: Nostalgic seafood restaurant chain exits Chapter Eleven financial disaster

The corporate has seen a severe change in customer behavior resulting from economic trends which have resulted in high inflation and extending interest rates, which prompted its target clientele to spend their money more consciously.

In its Q1 earnings report for 2024, Big Tons highlighted that its customer base is now specializing in value in relation to their day after day needs in place of in search of lower prices, which is something the company is known for.

In its last published quarter, the company reported a net lack of $205 million, with a ten.2% sales decrease and a comparable net sales decline of nearly 10% when put next with the year prior.

Big Tons officially files for Chapter Eleven

On Monday, Big Tons (BIG) announced it had entered a sale agreement with investment firm Nexus Capital Management to acquire the bargain retail company, including all its assets and business operations.

Big Tons said the acquisition would be within the company's best interest, and to facilitate the ownership transition, it'd initiate a voluntary Chapter Eleven financial disaster filing.

"Operating under new ownership who believes in our business and gives increased financial stability will toughen our long-term profitability," said Big Tons in a press free up.

Related: Big Tons retail chain in a position to file Chapter Eleven financial disaster

While the transition takes effect, Big Tons announced it'd close greater than one locations to continue smooth operations in its remaining ones.

As of the end of 2023, Big Tons has 1,392 stores in 48 states.

Wall Side road intervenes ahead of financial disaster

Big Tons' stock reached all-time highs within the course of the pandemic but has steadily decreased within the course of the last three years, including falling over Eighty one% within the past three months.

This downward spiral prompted Wall Side road to step in ahead of the financial disaster filing and inform Big Tons that its stock changed into no longer compliant with trading requirements because it had a same old closing price of lower than $1 over a consecutive 30-day period, as stated within the Chapter Eleven filing.

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On the opposite hand, this notice did no longer straight away put off the company's stock, which currently continues to be on hand on the market at a flatline as of Tuesday's market close.

A brand new era for Big Tons

As stated within the sale agreement, Nexus Capital Management is considered the winning bidder within the acquisition of Big Tons, which is anticipated to close within the course of the fourth quarter of 2024.

Within the agreement, Big Tons secured $707.5 million in financing, including $35 million in funding from its current lenders.

If approved by the court, the financing is expected to present sufficient liquidity to improve the company while it completes the sale transaction.

Nexus Capital Management is an investment company with a portfolio consisting of greater than one investments in kind of a sort of businesses, including Sugarbear, Toms, and TruRoots.

"The Big Tons business has incredible potential and we are confident that its greatest days are in advance,” said Managing Director of Nexus Evan Glucoft within the announcement.

Big Tons' cult following reacts

Despite no longer making enough sales to avoid financial disaster, Big Tons has a fan base so committed that this is miles in a position to almost be considered a cult following.

Currently, Big Tons has over Three.5 million followers on Facebook alone, and quite a few the distraught went on the social media platform to specific their feelings in regards to the devastating news.

One loyal customer commented on a post regarding the Chapter Eleven filing saying:

"I would really leave out that store both here and in AZ! Cross your fingers, say some prayers!!"

On the other post, Big Tons fans chimed in by commenting:

"Awe, I am sad. I actually like Big Tons. this is my go-to at Christmas for character stuff. They've stuff no one else does."

"Love big a lot. It got me through really not easy times. I'm going to leave out it badly," the other wrote

On the opposite hand, financial disaster would no longer mean your favorite store straight away disappears forever, so quite a few these misgivings should be premature.

Related: Veteran fund manager sees world of pain coming for stocks