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After announcing plans to go out of business, bankrupt discount chain Big Lots says it struck a deal with an investment firm that would save about half of its stores across the U.S.

In a Dec. 27 press release, the Columbus, Ohio-based business revealed plans to sell its assets to Gordon Brothers Retail Partners. The Boston-headquartered buyer specializes in distressed companies.

According to the announcement, Gordon Brothers will facilitate the transfer of Big Lots’ brand, stores and distribution centers to other retailers. Within New Jersey, Big Lots closed nine stores since September and now has 16 left.

Variety Wholesalers Inc. will acquire between 200 and 400 Big Lots locations and up to two distribution centers. The Hendersonville, N.C., business owns more than 400 retail stores in the Southeast and Mid-Atlantic regions, the release said.

Big Lots did not provide additional details on which locations Variety Wholesalers will acquire. A spokesperson declined to provide more information to NJBIZ.

Try again

The agreement with Gordon Brothers is subject to approval by U.S. Bankruptcy Court for the District of Delaware, the venue where Big Lots filed for Chapter 11 back in September. 

In its bankruptcy petition, the chain attributed a pullback in consumer spending on furniture, home décor and seasonal products to inflation and high interest rates.

At the time, Big Lots said it expected to sell all assets and ongoing business operations to private equity firm Nexus Capital Management for about $760 million. It also reduced its brick-and-mortar footprint, going from 1,400 stores nationally to around 900 locations.

However, Big Lots said Dec. 19 the deal with Nexus fell through. Meanwhile, the company announced it would move forward with liquidation sales at its remaining locations. 

Big Lots also filed a WARN notice that same day, disclosing that up to 555 employees at its corporate headquarters – including president and CEO Bruce Thorn – would lose their jobs. In New Jersey, Big Lots reported it expected to cut 385 retail workers by the end of February 2025.

Variety Wholesalers said it may employ an unspecified number of Big Lots staffers at stores and distribution centers, as well as some corporate associates “to support the go-forward footprint,” according to the latest press release.

‘Strongest opportunity’

In a statement, Thorn described the strategic sale to Gordon Brothers as “a favorable and significant achievement for Big Lots that reflects the tireless work and collective effort of our team.”

“This sale agreement and transfer present the strongest opportunity to preserve jobs, maximize value for the estate and ensure continuity of the Big Lots brand. We are grateful to our associates nationwide for their grit and resilience throughout this process,” said Thorn.

The planned sale comes about six months after Big Lots expressed “substantial doubt” about its ability to continue as a going concern. Though the company initiated a turnaround effort to improve performance, its board of directors determined a sale would ultimately ensure the best path forward to maximize value and ensure continued operations.

Rick Edwards, head of North America retail at Gordon Brothers, said, “We are pleased to reach this strategic agreement with Big Lots and partner with Variety Wholesalers to achieve a path forward that allows Big Lots to continue to serve customers with extreme bargains and an outstanding shopping experience.”

Variety Wholesalers President and CEO Lisa Seigies also expressed enthusiasm. “We are excited to partner with Gordon Brothers to provide a path forward for the Big Lots brand and hundreds of its stores. We look forward to working with members of the Big Lots team to realize the exciting opportunities ahead,” Seigies said.