Gander Mountain Co., the bankrupt retailer of hunting and fishing gear, has attracted buyer interest that could keep most of its stores open after the company restructures its debt, according to people with knowledge of the matter.
Sportsman’s Warehouse Holdings Inc. is planning to bid for as many as 80 percent of Gander Mountain’s stores, said the people, who asked not to be named because the discussions are private. Sportsman’s Warehouse is still deciding whether it would keep the Gander Mountain name on those locations or run them under its own brand, the people said.
Midvale, Utah-based Sportsman’s Warehouse has almost 80 stores in 22 states, mostly in the western U.S., with some in the mid-Atlantic region. For three years, it had a store at 11645 E. Kellogg but closed it and 22 others in 2009 in a move to reduce its bank debt.
St. Paul, Minn.-based Gander Mountain’s locations, more than 160 in 27 states – including 605 S. Wichita in the WaterWalk development downtown – are concentrated in the east. Sportsman’s Warehouse has about $200 million in debt, and its revenue has been rising in recent years, according to data compiled by Bloomberg.
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Gander Mountain filed for bankruptcy on March 10.
Jess Myers, a spokesman for Gander Mountain, would not comment on potential bids. Karen Seaman at Sportsman’s Warehouse didn’t immediately respond to a request for comment.
Stores in the U.S. are closing at a record pace, with sporting-goods chains hit hard as shoppers seek more bargains online and consumer tastes change.
Gander Mountain brought in Gordon Brothers and Hilco Merchant Resources to conduct going-out-of-business sales at all its stores if no buyer comes forward to save the chain, according to court documents. The agreement was designed to enable Gander Mountain “to continue to pursue and accommodate a sale of assets, in particular on going concern basis, to any potential buyer,” the company said in the contract filed with the bankruptcy court.
Gordon and Hilco have guaranteed that if they sell all the merchandise in its stores and warehouses, Gander Mountain will collect 91 percent of the wholesale cost of the items, which was estimated at $390 million to $430 million. If a going-concern buyer wins the auction, the liquidators would collect a $2 million breakup fee.
Under the auction rules, a going-concern bidder will have the option to buy some or all of Gander Mountain’s stores.