Sports Authority to close all stores
The Denver Business Journal (DBJ) is reporting that Sports Authority, once a major sporting good chain based in the Denver suburb of Englewood, Colorado, is planning on closing its remaining 450 stores. The company was unable to settle an agreement with lenders and creditors on reorganization plans. Additionally, they were unable to secure a bidder willing to buy and operate its stores. Sports Authority is planning “going-out-of-business” sales before the upcoming Memorial Day holiday in the US.
Back in March, the company filed for bankruptcy protection and, according to reports, was in arrears to brands such as Nike and Under Armour. At the time, the debt was north of $1bn. A liquidation group that includes Tiger Capital Group, Hilco Global and Gordon Brothers won a Monday auction. The DBJ noted that the group beat out smaller bids by sports retailers Dick’s Sporting Goods and Modell’s, Inc.
Sports Authority was once the largest sports retailer in the nation but endured competition from online retailers and the likes of Dick’s Sporting Goods and Modell’s.
Dick’s, like a number of brick-and-mortar retailers, is facing bumpy times as well, with 247 Wall Street reporting in March that Q4 and full-year 2015 results were sluggish. The Street noted that the Pittsburgh-based company’s stock is swooning in advance of Q1 results tomorrow but also indicated that it still has a “buy” rating and B grade due to “the company's revenue growth, attractive valuation levels, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures.”
Modell’s, Inc., a New York City-based, privately-owned retailer with stores mainly in the eastern US does not normal disclose results and the last published financial information has the company with 2007 revenues of around $635m. The company was embroiled in controversy in 2014 with the CEO, Mitchell Modell, being accused of expensing $7m on trips and food. Additionally, Dick’s filed suit in the same year, accusing Modell of posing as a Dick’s executive to illegally gather confidential business information. It was later settled out of court and terms were not disclosed.