Modell’s Sporting Goods’ liquidation sales have begun.
After filing for Chapter 11 protection last week, the 130-year-old retailer has firmed up its plans to close all of its 134 stores. As it liquidates its physical outposts, the company is also offering 25% off online purchases, saying that “everything must go.” Inventory is limited to stock on hand, and all sales are final.
The sporting goods chain filed for Chapter 11 protection last week in New Jersey bankruptcy court, citing a challenging retail environment. Modell’s listed the estimated value of its assets at $10 million to $50 million, dwarfed by estimated liabilities of $100 million to $500 million.
According to court documents obtained by FN, some of the largest athletic brands are among Modell’s creditors with the biggest unsecured claims. Modell’s owes Adidas USA Inc. $8.97 million.; Nike Inc. has an unsecured claim of $8.87 million; and Under Armour is owed $3.86 million.
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In recent years, Modell’s has been plagued by financial difficulties: A WSJ report in February indicated that the firm had hired financial advisers to help rein in challenges. CEO Mitch Modell told the publication that the company had ceased payments to a number of its landlords and vendors, and had begun negotiations with suppliers to remedy the situation.
Amid the company’s challenges, Modell considered selling a minority stake to try and save the family business. He had loaned the company $6.7 million last year to avoid bankruptcy, and Modell’s was recently forced to sell its Bronx, N.Y., warehouse for more money in an attempt to stay afloat.
Modell’s is among a growing list of sporting goods purveyors that have felt the pressures of an evolving retail environment in recent years. Grand Rapids, Mich.-based MC Sports filed for Chapter 11 protection in 2017; Sports Chalet announced it would close its doors in April 2016; Sports Authority declared bankruptcy in March 2016; and City Sports went out of business in late 2015.
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