GNC Holdings has filed a “prepackaged” Chapter 11 bankruptcy plan that will speed up the closure of at least 800 to 1,200 stores. Harbin Pharmaceutical Group Holding Co. will acquire the retailer for $760 million as part of the plan, which has backing from 90% of GNC’s creditors.
GNC also has secured approximately $130 million in liquidity, which will allow it to maintain normal operations during the bankruptcy proceedings. GNC’s ultimate plan is to “improve its balance sheet and capital structure while continuing to advance its business strategy, right-size GNC’s corporate store portfolio, and strengthen its brands to protect the long-term sustainability of its business,” according to a company statement.
The retailer first announced the mass store closures in July 2019, when it had planned to shutter up to 900 locations. GNC also closed 102 company-owned and franchise locations during the first half of 2019, and consumer trends have continued to hit the company hard: 61% of its stores are in strip centers and 28% are in malls, two areas that have been keenly affected by the COVID-19 pandemic.