Written by The Business Journal Staff
(AP) — Sports Authority is filing for Chapter 11 bankruptcy protection.
The retailer said Wednesday that it plans to close or sell about 140 stores and two distribution centers, in Denver and Chicago. A formal list of stores closing has not been released yet.
The Englewood, Colorado, company has 463 stores in 41 states and Puerto Rico, including a location in Fresno’s River Park shopping center. The store is the only facility in the Central Valley.
The store closings are expected to take up to three months.
Sports Authority stores will remain open and run on normal schedules during the Chapter 11 process. The company’s website will continue to function, and the chain plans to honor warranties on items purchased 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,” CEO Michael Foss said in a written statement. The executive said that it needs fewer stores as consumers are increasingly shifting to online shopping.
According to a letter to customers released online, Sports Authority will also be restructuring its remaining locations to improve the in-store experience. All gift card balances, return/exchange policies and product warranties will continue to be honored and Foss said the bankruptcy should have no impact on Sports Authority credit cards.
The retail industry as a whole has struggled with the consumer move to online shopping, trying to find ways to lure customers to brick-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 new campaign called “Get Your Penney’s Worth,” which offers certain store-label items for pennies.
Foss said that The 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 that 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 United States Bankruptcy Court for the District of Delaware.