Vitamin World Files for Chapter 11 Bankruptcy

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Vitamin World has officially filed for bankruptcy.

Vitamin World

The vitamin and health supplements retailer unveiled that it has filed for Chapter 11 due to a losing streak that has seen a number of its stores underperform. A total of 51 Vitamin World stores will shutter their doors.

The figure marks more than 15% of the company’s 334 stores in operation, most of which are located in malls and outlet centers. About 1,500 people are employed throughout all Vitamin World stores.

The filing was issued through the U.S. Bankruptcy Court in the District of Delaware, and it follows the 2016 closure of 45 stores that were also missing sales expectations.

This move helped the company save $2 million in profits, but it wasn’t enough as not all landlords were willing to meet the company’s real estate demands. “Debtors are further evaluating the leases for additional underperforming locations and will attempt to renegotiate the rent thereunder,” the bankruptcy document stated.

Vitamin World Chief Financial Officer Frank Conley added in the court filing Tuesday that the company has had “significant supply chain and ingredient availability sales” that took a hit on its sales and reduced the company’s liquidity as it transitioned away from previous owner NBTY Inc., a supplement manufacturer.

The company owes $14.4 million in accrued interest on secured debt, plus another $9.5 million related to a seller note that originated from Vitamin World’s 2016 buyout by a private equity company. Its inventory is worth roughly $30 million.


Article printed from InvestorPlace Media, https://investorplace.com/2017/09/vitamin-world-bankruptcy/.

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