Fred's (FRED) , the Memphis discount retailer operating stores in the U.S. Southeast, said on Monday that it filed for protection from creditors under Chapter 11 of U.S. bankruptcy law and would close its operations.

Fred's shares finished down 50% at 12 cents each.

"Despite our team's best efforts, we were not able to avoid this outcome," CEO Joe Anto said in a statement.

The retail industry is severely competitive and broadly has been hammered by consumers' shift to online trading.

Fred's said it made the filing in U.S. Bankruptcy Court in Wilmington, Del.

The company was founded in Coldwater, Mississippi, in 1947. In mid-July, when the company closed 129 retail stores, it said 80 stores would remain open.

Fred's said Monday that it started clearance sales at its stores and expected to close them within 60 days. It said it would continue to fill prescriptions at most of its pharmacy locations while it tried to sell them as part of the Chapter 11 process.

The retailer said it arranged $35 million of debtor-in-possession financing from its current lenders and was asking the court for permission to enter that agreement.

Meantime, it has asked the court for permission to continue paying employees and providing benefits.