Gordon Brothers began going-out-of-business sales Friday at all 29 Rugged Bear stores after no one emerged to best its stalking-horse bid at a Chapter 11 bankruptcy hearing.
The chain, which specializes in selling children's outdoor apparel and footwear, had originally intended to reorganize, but sought court permission to liquidate on Feb. 11 after failing to secure financing needed to buy spring inventory.
Local media reports indicated markdowns would start at 50%.
In its Jan. 25 Chapter 11 petition, Rugged Bear listed $8.1 million in assets and $10.4 million in liabilities, including hundreds of thousands of dollars owed to vendors in the outdoor industry. Among its 20 largest unsecured creditors were Kamik/Genfoot, owed $242.201.34; Turtle Fur Companies & Nordic Gear, owed $78,463.82; Washington Shoe. Co, owed $71,860.00 and Merrell, owed $68,212.00.
Rugged Bear was started in 1980 by Eastern Mountain Sports co-founder Alan McDonough. Detwiler Fenton Group Inc., a Boston financial brokerage, acquired the chain in January 2010 and hired a CEO to help it take advantage of the commercial real estate bust to find cheaper leases.
Detwiler Fenton, which holds a $755,000 note from the retailer, was listed as the company’s top unsecured creditor in bankruptcy filings.
Under the plan approved by a judge Wednesday, Rugged Bear is separately seeking buyers for its intellectual property.
Court records show Rugged Bear generated nearly $16 million in sales in 2010 from its stores in New England, New York and New Jersey.
