Liquidators will begin going-out-of-business (GOB) sales Thursday at the remaining 321 Sports Authority stores not already being liquidated.
As reported here, a trio of liquidators, Hilco Merchant Resources, Gordon Brothers Retail Partners and Tiger Capital Group, LLC, earned the right to liquidate the Sports Authority chain in a bankruptcy auction. The joint venture partners’ bid was approved by the U.S. bankruptcy court on Tuesday.
Gordon Brothers Group, along with Tiger Capital, began assisting the Company with the wind-down of 142 stores in March after they filed for Chapter 11 bankruptcy protection as part of an operational restructuring plan.
According to a statement, “Going-out-of-business sales will offer unprecedented values, in all stores, on shoes, clothing, athletic gear and accessories including such popular brands as Under Armour, Nike, North Face, Wilson, Adidas, Spalding, ASICS, Head, Coleman, Everlast and Brooks. Sports Authority gift cards will be honored through June 27, 2016. Store fixtures, furniture and equipment will also be available for sale. ”
The going-out-of-business sales at all Sports Authority stores are scheduled to go no later than August 31.
In a court filing seeking approval of the liquidation sales, Sports Authority’s lawyers addressed many of the objections to the sale and liquidation. They noted that because the debtors are not selling their business as a going concern, many of the objections that were filed are moot. These include objections related to the assumption and assignment of various leases and the cure costs associated therewith.
The three principal categories of live objections to the motion are: (1) objections filed by consignment vendors, (2) objections filed by landlords related to the conduct of “going out of business” sales, and (3) objections filed by landlords related to the payment of March stub rent.
The lawyers argued that consignment-related objections are misplaced and should be overruled. The debtors are not selling any consigned goods to the liquidator group; rather, the liquidators will assist Sports Authority in selling the goods and will receive a commission for doing so. The lawyers wrote, “Sales of consigned goods will continue to be governed by the Court’s prior rulings related to such sales and the debtors will comply with such prior rulings in connection with the “going out of business” sales.”
The debtors also anticipate that the landlords’ conduct objections will all be resolved consensually through side letters between the liquidator group and the applicable landlords. Finally, Sports Authority believes that the landlords’ stub rent-related objections should be dealt with in the context of the pending stub rent motions.
