While the Albertsons-Rite Aid break-up happened months ago, it appears that the drug store chain is still in the process of regrouping. This week, Rite Aid announced organizational restructuring, which will cost $38 million, and a leadership shakeup that will include John Standley stepping down from the CEO position.
In addition to Standley's departure from the company, Rite Aid announced the following leadership changes, effective immediately:
"The Board believes that now is the right time to undertake a leadership transition,” Bruce Bodaken, Chairman of Rite Aid’s Board of Directors, said in a press release. "We will be focused on recruiting a leader that will best position Rite Aid to create long-term value for shareholders. As we conduct the search process, John has agreed to stay until we appoint his successor. We thank John for his outstanding leadership in guiding the Company over the past several years. His leadership and expertise has been critical to ensuring the company's stability and success through an extremely challenging environment. In addition, we are confident that Bryan, Matt, and our senior leadership team have the capabilities and experience necessary to effectively guide Rite Aid forward. On behalf of the Board, I want to thank Kermit, Darren, and all the other departing associates for their service and contributions to the company.”
The restructuring plan also outlines the consolidation and elimination of senior leadership and managerial roles, which could amount to cutting over 400 jobs—20 percent of the corporate positions located at the chain’s headquarters—by 2020. The job cuts aim to save approximately $55 million.
“Rite Aid’s Board of Directors is committed to more closely aligning the structure and leadership of the company with our present scale and today’s announcement is an important step in positioning Rite Aid for future success,” Bodaken continued. “These are difficult decisions and we recognize the implications they have for individuals across our organization. However, it is imperative we take action to reduce the cost of current operations and become a more efficient and profitable company.”
For more information regarding the leadership transition and Rite Aid’s restructuring plan, click here.
Will Rite Aid's newly appointed leadership team be able to steer the chain out of rocky waters and into the port of a potential new grocery partner? Deli Market News will continue to report on the latest news as it relates to grocery.