MC Sports Files for Bankruptcy, Will liquidate All Stores
By Nick Davis, February 16, 2017
Regional sports retailer MC Sports has announced it will file for chapter 11 bankruptcy protection.
The chain made the announcement on Tuesday. As a part of the voluntary reorganization, the company announced it will hold a liquidation sale at all 68 of it’s stores, including one in Ottumwa.
MC Sports opened their Ottumwa location in the late summer of 2013. The store is one of three main anchors of the Quincy Place mall.
The announcement leaves the future of the company and their 68 stores in question. The announcement does not say that MC Sports will close it’s stores, leaving open the possibility that the chain will reorganize and leave open some locations. Some news reports do indicate that the chain will eventually close all of it’s locations.
A chapter 11 bankruptcy usually proposes a plan of reorganization to keep its business alive and pay creditors over time.
The move is another blow to Ottumwa’s retail base. In a little more than a year Ottumwa has lost both Target and Kmart and now potentially MC Sports.
“After a valiant and concerted effort by MC Sports’ associates, vendors, landlords, and outside professionals to restructure the Company’s balance sheet and operating performance, the Company was unable to reach an agreement on a viable out of court proposal. The only alternative to address our immediate liquidity issues is to commence liquidation sales at all stores, while concurrently expediting our pursuit of alternative financing and going-concern sale options under the protections of Chapter 11,” stated Bruce Ullery, MC Sports President and CEO. “To lead our exploration of alternative options, the company recently retained the independent advisory firm, Stout Risius Ross Advisors, LLC.”
Like many retailers in the sporting goods industry, the company has faced increased competition, the blurring of distribution channels by key athletic and outdoor brands, increasing direct to consumer sales by key vendors, and the market disruption and growth of ecommerce. In response to these headwinds, the company has been systematically moving to larger format stores that combine hunting, fishing and outdoor categories with traditional sports gear, footwear, and apparel. In addition, it has worked diligently to shed poor performing locations as lease opportunities became available.
Despite these actions, the company believes that the decision to file and the commencement of liquidation sales are necessary to address the Company’s immediate liquidity issue. The filing will allow the Company to address a number of legacy costs, including long term leases that are no longer in line with current market conditions, and trade debt that has hampered the company’s ability to develop a clear path forward.”
Founded in 1946 in Grand Rapids, MC Sports has been a sporting goods retailer selling sports gear, footwear, and apparel throughout the Midwest. The MC stands for My Community. As of February 14, 2017, MC Sports operates 68 locations in 7 states throughout the Midwest, including Illinois, Indiana, Iowa, Michigan, Missouri, Ohio, and Wisconsin. The 68 locations include one onsite Ski Shop at Cannonsburg Ski Area in Belmont, Michigan. The company is headquartered in Grand Rapids, MI.