Sports Authority, the nation’s preeminent full-line sporting goods chain and online shop that also sells golf equipment, supplies and accessories, filed for bankruptcy in March and is weighing a sale of its assets that could end up closing most if not all of its 450 stores.
Under its original bankruptcy filing, the struggling chain had planned to close 140 stores and to keep the rest open under the Sports Authority name. But attorneys for Sports Authority notified the federal bankruptcy court in Delaware last week that it could not win approval for that reorganization plan from its creditors and lenders.
Sports Authority is “pursuing a sale of some or all of the business,” said a statement from the company. “We have received initial expressions of interest from a number of potential buyers, and we are optimistic about the results of the [sale] process. The outcome of the…process will determine whether any additional store closings will be required.”
But experts say it’s now likely that the large majority, if not all, of the chain’s stores will go away in relatively short order.
“It’s a well-known brand. It’s on the top of stadiums. But it’s safe to say there’s a tarnish on the brand now,” said Larry Perkins of SierraConstellation Partners, an expert in retail reorganizations.
Perkins said if someone buys Sports Authority with the intention of keeping the chain operating under that name it will likely be in limited to parts of the country with little competition, where competitors like Dick’s Sporting Goods (DKS) have not established themselves yet. Those areas could include the Pacific Northwest or upper Midwest.
“While Dick’s appears to be the winner in this sector, it can’t cover every market right now,” Perkins said.
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