Source: LA Times
Earlier this year in March, Sports Authority filed for Chapter 11 bankruptcy and made plans to restructure their existing stores which included selling or closing about 140 stores (about 450 operating stores; around ⅓ of their locations).
However, in recent events, the sporting goods retailer just announced recently that they have decided to sell off remaining assets, forgoing their plan to reorganize under the Chapter 11 bankruptcy protection. The retailer just gave notice to the U.S. Bankruptcy Court in Wilmington, Delaware earlier this week of their intent to sell rather than reorganize. As such, majority of the company’s assets will be up for auction starting May 16th.
The remaining Sports Authority stores open and closures will depend highly on the potential buyers but most industry analyst are saying that all remaining store locations (450) will likely be liquidated. Chances of the stores remaining open are slim but if the future buyer were to leave some locations open, they will likely be in the Pacific Northwest or upper Midwest where major competitor Dick’s Sporting Goods have yet to set up shop in those regions.
This all follows the growing trend of many major retailers shuttering their brick and mortar locations. Some has turned to strengthening their online sales while others like Macy’s, turn to off-price strategy to compete with successful off-price retailers Nordstrom Rack, TJ Maxx and etc. To increase in-store foot traffic, JCPenney recently launched an initiative to start selling items for 1¢ in-stores only.
Source: Daily Press
Sports Authority has yet to update with the official news but shoppers will likely see a surge in sales and discounts from Sports Authority in the coming weeks.
Furthermore, Sports Authority decision to sell could mean that the Broncos could be forced to change the name of their stadium again (currently called Sports Authority Field at Mile High). Sports Authority currently pays roughly 6 million annually for the naming rights over the stadium. However, seeing as they have already missed a major debt payment of $20 million back in January, its unlikely that Sports Authority will be able to make the payment on their naming deal coming due in August.