Nearly 200 shuttered 99 Cents Only stores from Texas to California will be re-opened as Dollar Tree locations after the leases were secured out of bankruptcy proceedings.
The transfer of designation rights for 170 locations in Texas, Arizona, Nevada and California, along with some of the furniture, equipment and fixtures inside, was approved by the United States Bankruptcy Court for the District of Delaware.
Shares of Dollar Tree Inc., based in Chesapeake, Virginia, rose about 1% before the opening bell Thursday.
99 Cents Only Stores filed for Chapter 11 bankruptcy protection last month and has been shedding assets ranging from inventory to store leases. The company said in April that it would close all 371 of its stores, ending a 42-year run for the bargain outlet.
99 Cents Only had struggled for some time with shifting consumer demand, inflation and theft, and it's not alone among bargain store chains.
Dollar Tree posted a surprise loss in its final quarter of 2023 and said that it would close nearly 1,000 stores, most of them Family Dollar stores that it had acquired a decade earlier for more than $8 billion after a bidding war with rival Dollar General.
Dollar Tree Chief Operating Officer Michael Creedon said in a prepared statement on Wednesday that the one-time 99 Cents locations are in priority markets where it expects strong growth potential.
“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,” he said.
Dollar Tree anticipates reopening the stores as early as the fall.