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The 85-year-old company, which reportedly has been dealing with nearly a billion dollars of debt announced it will be shuttering at least a quarter of its locations as it faces a shortage of customers due to the COVID-19 outbreak.
According to GNC, the company “has been executing a store portfolio optimization strategy to close underperforming stores, while continuing to invest in omnichannel and brand strategies to better meet consumer demand."
GNC filed for Chapter 11 bankruptcy effective as of Tuesday, June 23, according to the company, though it will continue to operate on a smaller scale.
The company’s bankruptcy filing comes days after it paid nearly $4 million in cash bonuses to top executives, according to reports. The bonuses were paid out on Thursday, June 18, five days before the bankruptcy filing
“GNC and all of its subsidiaries remain open for business,” the company said in a statement. “Consumers will continue to have access to their favorite products, as well as new, innovative brand solutions to meet their wellness goals wherever GNC products are sold.
“GNC continues to serve consumers through its retail stores in many areas and is offering safe and convenient curbside pick-up at shopping plaza locations.”
The company noted that it also has “$130 million in committed additional liquidity from certain of its secured lenders in the form of new financing and loan amendments” to help continue the business.
“This process will enable GNC to accelerate these strategies, including its store portfolio optimization. GNC expects to accelerate the closure of at least 800 to 1,200 stores,” the company said.
“This acceleration will allow GNC to invest in the appropriate areas to evolve for the future, better positioning the company to meet current and future consumer demand around the world.”
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