Rite Aid has emerged from federal bankruptcy protection and will operate as a private company. And it has promoted its CFO, Matt Schroeder, to chief executive.
The drug store chain announced on Tuesday that Schroeder is succeeding Jeffrey S. Stein, who stepped down as CEO and chief restructuring officer in connection with the company’s emergence from Chapter 11. Schroeder has been part of Rite Aid since 2000, serving in various leadership positions before becoming CFO in 2019.
Through its financial restructuring process, Rite Aid has eliminated approximately $2 billion of total debt, the company announced on Tuesday. Additionally, it has received approximately $2.5 billion in exit financing to support the business going forward.
Ownership of the company transitioned to “certain Rite Aid creditors” and all of the company's existing common shares were canceled—a common event in bankruptcy that was set out in the company's plan of reorganization. Founded in 1962, Rite Aid made its first public offering and started trading on the American Stock Exchange in 1968. It then moved to the New York Stock Exchange in 1970.
Rite Aid posted annual losses for several years in part due to slumping sales. The company also faced controversy regarding opioid-related lawsuits. Since 2021, it has moved down 39 spots in the Fortune 500 landing at No. 171 in 2024.
Rite Aid responded to these headwinds by cutting costs and closing stores, but it was not enough to stave off bankruptcy. Going through Chapter 11, however, will help “significantly reduce the company’s debt” while helping to “resolve litigation claims in an equitable manner,” Rite Aid said in October.
In its federal bankruptcy filing, Rite Aid stated that it operates over 2,000 retail pharmacy locations, and that it planned on closing 154 stores. Its careers website now states it has approximately 1,700 retail pharmacy locations. Before filing for Chapter 11, in January 2023, Heyward Donigan, CEO of Rite Aid since 2019, stepped down.
“The board determined and Heyward agreed that now is the right time to identify the next leader of the business,” Rite Aid Chairman Bruce Bodaken said in a statement at the time. Elizabeth Burr, a member of the board, was appointed as interim CEO. Burr served in the role until October when Stein, another member of the board, took over as CEO and chief restructuring officer. His experience includes supporting companies undergoing transformations and financial restructuring.
Now, Schroeder is at the helm of the company. He has a deep understanding of the business and is “an excellent fit for the company,” Bruce Bodaken, chair of Rite Aid’s board of directors during its Chapter 11 process, said in a statement.
“Thanks to the dedication of the entire organization, we are beginning our next phase as a transformed company,” Schroeder said in a statement.
Rite Aid informed Fortune via email on Wednesday afternoon that it has appointed Steve Bixler, the chief accounting officer, as acting chief financial officer.
