Modell’s bankruptcy, going out of business.
The nation’s oldest family-owned and operated retailer of athletic apparel, footwear and sporting goods on Wednesday filed for Chapter 11 bankruptcy protection. Modell’s, in partnership with Tiger Capital Group, will initiate store-closing liquidation sales beginning March 13. Online sales will continue during the process.
“This is certainly not the outcome I wanted, and it is one of the most difficult days of my life,” stated Mitchell Modell, CEO, Modell’s, which operates 153 stores, primarily in the Northeast. “But I believe liquidation provides the greatest recovery for our creditors.”
Sporting goods retailers have not had an easy time of it in recent years, challenged by online and discount competition. Among the chains that have shut down operations are Sports Chalet, Sports Authority and City Sports.
In his statement, Modell said that, over the past year, the company evaluated several options to restructure its business to allow it to maintain operations.
“While we achieved some success, in partnership with our landlords and vendors, it was not enough to avoid a bankruptcy filing amid an extremely challenging environment for retailers,” he added.
Modell’s said its lenders and long-standing partners will provide the company with the financial flexibility to operate the business in the near term, including the timely payment of employee wages and benefits, continued provision of customer orders and shipments, and other obligations as they come due.
“We are extremely appreciative of the support that our lenders (JP Morgan Chase and Wells Fargo), vendors and landlords provided during this difficult period, engaging in extensive renegotiation efforts and allowing us to pursue every possible avenue to preserve the jobs of our loyal associates,” Modell said.
In February, Modell’s said it would some close some stores and was considering offering a minority stake in the company as it looked at various options to keep afloat.
In his statement, Modell said the liquidation of the first 19 stores managed by Tiger has been “beyond spectacular, and we are confident this performance will continue across the remaining stores, maximizing return for our creditors.”
Modell’s operates 153 stores located in New York, New Jersey, Pennsylvania, Connecticut, Rhode Island, Massachusetts, New Hampshire, Delaware, Maryland, Virginia and Washington, DC.