Sports Authority is filing for Chapter 11 bankruptcy protection and plans to get rid of nearly a third of its stores.
The retailer said Wednesday that it plans to close or sell about 140 stores and two distribution centers, one each in Denver and Chicago. The specific stores to be closed or sold will be determined as part of the Chapter 11 process, a spokesman told the Los Angeles Times.
See more of our top stories on Facebook >>
The Englewood, Colo.-based company has 463 stores in 41 states and Puerto Rico. The store closings are expected to take up to three months.
Sports Authority stores are to run on normal schedules during the Chapter 11 process. The company said its website will continue to function, and the chain plans to honor warranties on items bought at its stores or online.
“We are taking this action so that we can continue to adapt our business to meet the changing dynamics in the retail industry,” Chief Executive Michael Foss said in a written statement. He said the company needs fewer stores as people are shifting to online shopping.
The retail industry as a whole has struggled with the consumer move to online shopping, trying to find ways to attract customers to bricks-and-mortar stores instead. Macy’s Inc. has opened Macy’s Backstage in order to go head to head with discount retailer T.J. Maxx. And J.C. Penney Co. is using store-label offerings to fight against pricing pressures from online rivals and recently launched a campaign called “Get Your Penney’s Worth,” which offers certain store-label items for pennies.
In a letter to customers posted on the company’s website, Foss said Sports Authority’s long-term plan includes upgrading stores and improving its website.
Foss said that Sports Authority Inc., which is privately held, has received interest from third parties that may want to invest in or buy some or all of the business. The company plans to continue evaluating all of its options, he added.
Sports Authority said it expects to have sufficient liquidity during the Chapter 11 process when factoring in cash from operations and anticipated access to up to $ 595 million in debtor-in-possession financing.
Sports Authority made its Chapter 11 filing in the U.S. Bankruptcy Court for the District of Delaware.
Times staff writer Samantha Masunaga contributed to this report.
MORE BUSINESS NEWS
California high court opens door to wrongful foreclosure suits
Davan Maharaj is named editor-publisher of the L.A. Times in Tribune Publishing shake-up
Glass slide suspended from 1,000 feet in the air? It’s coming to downtown L.A.
No comments:
Post a Comment