WILMINGTON, Del. (BRAIN) — Sports Direct, which operates more than 700 stores worldwide as well as the Muddyfox and Silver Fox bike brands, has purchased Eastern Outfitters LCC, the company that owns Eastern Mountain Sports and Bob's Stores. Sports Direct paid $101 million for the retail group.
The purchase will give Sports Direct, based in the United Kingdom, its first foothold in the U.S.; the company said the acquisition will give it about 50 brick-and-mortar stores as well as a U.S. e-commerce platform. Besides its retail brands, Sports Direct owns Muddyfox, the Dunlop and Everlast sporting goods brands, and the No Fear action sports brand. Muddyfox, which started as a BMX brand, was one of the first mountain bike brands in the U.K.
A year ago, Vestis Retail Group, which owned EMS, Bob's and Sport Chalet, declared bankruptcy. It closed the Sport Chalet stores but restructured EMS and Bob's as Eastern Outfitters. However, Eastern Outfitters then filed for Chapter 11 bankruptcy in February this year, with debts estimated at more than $100 million. During the company's negotiations to sell its assets to Sports Direct, it agreed to shutter nearly 50 stores earlier in April. A Delaware bankruptcy court approved the sale on Friday.
Sports Direct has paid $101 million in cash, all of which has either been advanced by Sports Direct by way of debtor-in-possession and other loans to Eastern Outfitters LLC prior to, and as part of, the Chapter 11 process, or been used by Sports Direct for the acquisition of Eastern Outfitters' debt.
Eastern Mountain Sports has traditionally sold bicycles at some of its stores and online. No bicycle brands were listed among its top 50 creditors in its February bankruptcy filing, but CamelBak was owed $95,000 and Keen was owed $58,000.
Sports Direct expects to finalize the acquisition next month.
