Discount retailer Big Lots mulls bankruptcy filing as sales slump, Bloomberg reports Reuters

(Reuters) – Discount home goods retailer Big Lots (NYSE: ) is considering a possible bankruptcy filing and could seek court protection within weeks, Bloomberg reported on Wednesday, citing people familiar with the plans.

The company is also seeking investors in an attempt to avoid Chapter 11, according to the report.

Big Lots did not immediately respond to a Reuters request for comment. Its shares fell 27 percent in extended trading and have lost nearly 88 percent of their value this year.

Big Lots is trying to shore up its liquidity, which has been squeezed by a drop in sales over the past two years as high interest rates have hurt demand for big-ticket discretionary purchases.

The plans are not final and Big Lots’ path may change, the report said.

In June, the company raised doubts about its going concern after it posted a bigger-than-expected quarterly loss and said it may not be able to meet its credit and loan obligations in the near future.

At the end of the first quarter, the company had net cash of $289 million and cash and cash equivalents of $44 million.