In yet another story of a retail darling turned bygone brand, Sports Authority announced earlier this week that it had filed for bankruptcy. The sports apparel retailer said that 140 of its 463 stores would be closed or put up for sale in the coming months, in addition to the closure of two distribution centers.
According to an article in The Wall Street Journal, the practice of unloading retail space and leases is common as companies seek to lower operating costs in order to repay creditors and make themselves more attractive to potential buyers. One such buyer may be competitor Dick’s Sporting Goods, which is reportedly considering purchasing Sports Authority’s retail footprint and intellectual property portfolio. According to sources who recently spoke to Bloomberg on the condition of anonymity, Modell’s Sporting Goods is also in the mix as a possible candidate to buy some Sports Authority stores.
Leases for 87 of the properties earmarked for closure have already hit the block, with 25 of them in Texas alone, according to a marketing document obtained by The WSJ. The retailer is also reducing its footprint in Florida and California.
The number of stores Sports Authority will close is still somewhat fluid, says The WSJ. As the brand was preparing for bankruptcy, the company and its restructuring advisers identified “up to 200” underperforming locations it thought it might seek to close, according to court papers. When all is said and done, the company could be forced to liquidate its entire footprint by the end of April if it can’t find a suitable buyer for its core locations, The WSJ reported.