Dollar Tree Inc. is taking over leases of 170 99 Cents Only Stores across Arizona, California, Nevada and Texas, including a number in Southern California. Commerce-based 99 Cents Only Stores filed for Chapter 11 bankruptcy on April 7 after failing to find prospective buyers and renegotiate with creditors. The company cited debt-related challenges and the costs of doing business as reasons for the filing, which came days after the company announced a shutdown and liquidation sale of its 371 stores.
The Dollar Tree deal was approved by the United States Bankruptcy Court for the District of Delaware. The company also acquired the North American intellectual property of 99 Cents Only Stores and some on-site goods.
“As we continue to execute on our accelerated growth strategy for the Dollar Tree brand, this was an attractive opportunity to secure leases in priority markets where we see strong profitable growth potential,” Michael Creedon, Jr., Dollar Tree’s chief operating officer, said in a statement. “The portfolio complements our existing footprint and will provide us access to high quality real estate assets in premium retail centers, enabling us to rapidly grow the Dollar Tree brand across the western United States, reaching even more customers and communities.”
In a release, Dollar Tree said it could open locations in former 99 Cents Only Stores as soon as this fall. Dollar Tree has nearly 17,000 locations operating under Dollar Tree, Family Dollar and Dollar Tree Canada brands.
99 Cents Only Stores was founded in 1982 by Dave Gold. It quickly took off, expanding out of its initial Ladera Heights location.
It went public in 1996 but was taken private in 2011 when private equity firm Ares Management and the Canada Public Pension Plan Investment Board bought out the shares in a $1.6 billion transaction.
In its bankruptcy filings, Chief Restructuring Officer Christopher Wells said the company faced supply chain issues, retail theft and rising inflation, among other issues, in recent years.
Dollar Tree isn’t the only company to have shown interest in 99 Cents Only Stores. Mark Miller, president of Culver City-based Pic ‘N’ Save Bargains, previously indicated interest in acquiring all of the Southern California locations of the 99 Cents Only Stores. Miller did not return a request for comment.
