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.
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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.
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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