Vestis Retail Group Declares Bankruptcy, Will Close All Sport Chalet Stores
MERIDEN, CONN. — Vestis Retail Group LLC, the parent company of sporting goods and apparel retailers Eastern Mountain Sports (EMS), Bob’s Stores and Sport Chalet, filed for Chapter 11 bankruptcy on Monday.
The Meriden-based company plans to close the Sport Chalet chain entirely, while closing eight EMS properties and one Bob’s Stores location. The remaining stores will be re-evaluated in an attempt to strengthen financial performance.
Collectively, Vestis Retail Group operates 144 stores and two distribution centers across 15 states, according to documents filed at the U.S. Bankruptcy Court in Wilmington, Del.
Hilco Merchant Resources and Gordon Brothers Retail Partners are in charge of the liquidation sales, according to court documents.
Private equity firm Versa Capital Management LLC (Versa) acquired each of the chains separately and combined them under the parent company Vestis Retail Group LLC in 2012, according to reports by The Wall Street Journal. Vestis has proposed the sale of EMS and Bob’s to funds advised by Versa, which would acquire substantially all of the remaining assets of the company.
“When Vestis first acquired EMS and Sport Chalet, each company faced significant operational challenges and was on the verge of liquidation,” says Mark Walsh, CEO of Vestis. “EMS and Bob’s are now delivering solid performance, but have been burdened by limited financial flexibility due, in part, to the unique competitive pressures facing Sport Chalet.”
“After reviewing a variety of strategic alternatives, we determined that the best path forward is to separate the businesses and confront the challenges that have been hindering our overall progress,” Walsh continued. “We are confident EMS and Bob’s will be well positioned to thrive at the conclusion of the process.”
Klee, Tuchin, Bogdanoff & Stern LLP, Lincoln Partners Advisors LLC and FTI Consulting are advising Vestis in the proceedings.
— Katie Sloan