Sports Authority Seeks Buyers for 140 Stores

by San Antonio Attorney

The company has been fending off bankruptcy rumors since January, when the company stated that they missed a $20 million debt payment.

The closings for the stores will be expected for the next three months.  An announcement will be made to which branches will be eliminated.  The bankruptcy filing will provide the opportunity to eradicate the financial obligation of leases to the financially-challenged stores.

According to the sporting goods chain, it will find new owners for 140 stores that it plans to close.

The closure of the store will put 14,500 employees, both full and part time, distributed in the 450 stores and offices, according to the bankruptcy filing.  Part time workers consists nearly two thirds of the population.

The company’s challenge post bankruptcy filing is to loan an amount of $595 million to maintain running its operations.  This amount will be easily finished to pay off the loans and find a potential buyer to maintain the remaining stores.  These measures to keep Sports Authority afloat will not be impossible to do.

Sports Authority was purchased by a hedge fund in 2006 and was considered to be the largest sporting goods retailer.  However, the company struggled with debt load with a leveraged buyout at the same time it was purchased.

Dick’s Sporting Goods, Sport Authority’s competitor, gained upper hand when they expanded into a high end goods store.

Since 2008, a multitude of retail stores have filed for bankruptcy.  Circuit City and Borders initially filed for bankruptcy and eventually closed.

A year ago, Radioshack and American Apparel filed for bankruptcy but retained the company with fewer stores.  Radioshack’s cause for bankruptcy was due to the evolving means of communication.

Sporting Authority, shells out $6 million dollars every year to put their name on the Denver Broncos stadium.  Denver Broncos is also the team to just recently bag the trophy for Super Bowl.

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