Michigan-based MC Sports will join the likes of Gander Mountain in filing for Chapter 11 bankruptcy. The sporting goods store will immediately begin liquidating and closing all of its 68 stores, 22 of which are in its home state of Michigan.
The company said in a statement it was “unable to reach an agreement on a viable out-of-court proposal.” The filing will allow MC to “address a number of legacy costs,” including long-term leases and trade debt that have “hampered the company’s ability to develop a clear path forward.”
According to The Detroit Free Press, MC Sports has more than $14 million in trade debt. $3.8 million due to Nike, $2.4 million due to Under Armour, and hundreds of thousands worth due to others such as Adidas, Columbia Sportswear and Wilson Team Sports.
Piling on top of that, the company has almost $475,000 in debt for media and marketing services, court filings show.
“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 e-commerce,” the company stated.
“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.”