Per editor: He Xiaotao, Bi Luming
According to CCTV Finance on September 25, citing a number of US media reports, the well-known American pharmacy chain Laideai is negotiating the terms of a bankruptcy plan that may close about 500 stores.
Discussions are underway with creditors about the exact number of stores to close, and the company plans to hold an auction to sell another of its pharmacy brands and other business assets. In a statement, Laide said that negotiations are still ongoing and no decision has been made. At present, Led&Ai operates more than 2,000 stores in 17 states in the United States, and long-term capital lease contracts of up to more than $2 billion have put significant pressure on the company's financial position.
The Wall Street Journal previously reported that the main reason for the bankruptcy of the Leyde Love plan was more than US$3.3 billion (about 24.1 billion yuan) of debt and allegations that it oversupplied prescription painkillers.
Shares have plummeted nearly 90% this year
On March 14 of this year, the U.S. Department of Justice filed a lawsuit against LeadAid, accusing the company of "knowingly" contributing to the opioid crisis. U.S. Deputy Attorney General Gupta said in a statement that Lydeai has prescribed hundreds of thousands of prescriptions that do not meet legal requirements. "Pharmacists in Lady Love repeatedly filled prescriptions for controlled substances with clear red flags, and the company deliberately deleted internal instructions about suspicious prescribers. These practices open the floodgates for the illicit outflow of millions of opioids and other controlled substances. ”
The Wall Street Journal notes that the bankruptcy filing will put those lawsuits on hold and provide the company with another avenue to resolve them. The Justice Department's allegations have been denied and said the company "does not comment on rumors and speculation." Xinhua reported that opioids are the main trigger for overdose deaths in Americans. In 2021, the drugs killed more than 80,000 people in the United States.
According to public information, Leadai is the second largest pharmacy chain in the United States, with more than 2,000 stores in the United States. The first store opened in 1962 in Pennsylvania, USA. In June 2023, Lyde Love was selected into the 2023 Fortune 500 US list, ranking 161st.
As of the close of U.S. stocks, Rad's shares plunged 33.90% to close at $0.39, with a total market value of $22.11 million, and the stock price has plunged nearly 90% since the beginning of this year.
The Fed raises interest rates aggressively
The number of bankrupt companies in the United States increased
According to media reports, according to a report released by the Guggenheim Investment Company, the number of bankrupt companies in the United States this year may reach the highest level since 2010 due to the sharp increase in corporate borrowing costs due to the Fed's aggressive interest rate hikes. In the high interest rate environment, the operating profit of the US real economy has been squeezed, and the operating pressure is gradually increasing.
According to CCTV news, there are many century-old giant enterprises that have filed for bankruptcy!
In January 2023, the American mattress brand "Simmons" filed for bankruptcy.
In April 2023, 3B Home, the largest household goods chain in the United States, filed for bankruptcy, with a market value of $17 billion.
In July 2023, the news of Yellow's sudden bankruptcy caused a huge stir on social media around the world. As a transportation giant with nearly 100 years of history, Yellow has annual sales of US$9.5 billion at its peak, more than 30,000 employees, 12,000 trucks, and customers covering 800,000 companies around the world, and Fortune magazine has selected it as the number one and most admired company in the transportation industry for three consecutive years.
In August, the bankruptcy momentum of US companies remained unabated. Electric bus manufacturer Proterra filed for bankruptcy protection on the 8th of this month.
Analysts warn that a wave of corporate defaults could hit the U.S. economy. According to the Guggenheim report, as of the end of August, more than 450 U.S. companies had filed for bankruptcy protection, more than the number of bankruptcies in the past two years combined.
According to CCTV quoted by CNN, a spokesman for the US Federal Reserve recently said that the Fed system will lay off about 300 employees before the end of this year, which is the first time the institution has cut staff in 13 years, and suffered a huge loss of more than 400 billion yuan in the first half of the year.
Editor|He Xiaotao, Bi Luming, Du Bo
Proofreading | Duan Lian
Daily economic news comprehensive CCTV finance, Xinhua News Agency, Cai Lian News Agency, CCTV news
Daily economic news