Two months after parent company Vestis Retail Group LLC filed bankruptcy, sporting goods retailers Eastern Mountain Sports and Bob’s Stores have completed the restructuring and recapitalization process.
EMS and Bob’s will now operate as business units of Eastern Outfitters LLC, a new holding company with $400 million-plus in annual multichannel revenue headquartered in Meriden, Conn., the retailers announced Tuesday.
CEO Mark Walsh will lead the newly formed entity’s senior management team.
“We move forward with a focused strategy and strengthened capital structure that will enable EMS and Bob’s to prosper,” Walsh said in a release. “The management team and I would like to thank our trade and service partners for their unwavering support and for recognizing the value of our brands and their confidence in our strategic plan.”
When Connecticut-based Vestis Retail Group filed for Chapter 11 protection in April, the company said it would exit its Sport Chalet business altogether — and that it would sell EMS and Bob’s to funds advised by Versa Capital Management LLC, the Philadelphia-based private equity firm that also owned Vestis.
“We are pleased that this transaction provides EMS and Bob’s — two strong and growing retailers — the opportunity to continue providing exceptional service to their loyal customer bases,” said Gregory Segall, chairman and CEO of Versa, in a release. “We appreciate the significant support the companies received from their trade creditors. Their affirmation of the important positions EMS and Bob’s hold in their respective markets was a major catalyst for this successful and accelerated restructuring.”
He added, “With an enhanced capital structure and healthy balance sheet, EMS and Bob’s now have the flexibility they need to prosper in the current retail environment that rewards brands that offer unique products with highly attentive customer service at attractive price points.”
High real estate costs, increased brick-and-mortar competition and pressure from e-commerce players led a number of players in the sporting goods space, including City Sports and Sports Authority, to seek bankruptcy relief in recent months. Unlike EMS & Bob’s, Sports Authority and City Sports were unable to restructure and stay in business.