Copeland Sports granted court OK of bid procedures for $21.7 million asset sale

By Caroline Salls

Pittsburgh, Nov. 9 - Copeland Sports obtained court approval of the bid procedures for the proposed $21.7 million sale of substantially all of its assets, according to a Thursday filing with the U.S. Bankruptcy Court for the District of Delaware.

The stalking horse bidder is a joint venture between Sports Authority, Hilco Merchant Resources, LLC and Hilco Real Estate, LLC, with a $21.7 million bid.

The stalking horse bid is predicated on a $23 million total cost value of inventory, with adjustments up or down at 80 cents for each dollar of deficiency below $22 million.

According to the motion, sales performance at the stores not covered under the order approving going-out-of-business sales for some of Copeland's locations has been disappointing, partially because major suppliers Nike and Titleist are not supplying products to the remaining stores.

As a result, the company said it decided a sale of substantially all of its assets was appropriate to offset the risk of further diminishment of the bankruptcy estates.

Upon entry of the bidding procedures order, the joint venture will pay a $2.17 million deposit, and it will pay $14.11 million at closing. The bidder will post letters of credit for the remainder of the purchase price.

If the joint venture is not the high bidder, it will receive a $630,000 break-up fee.

All other bids must include a 10% deposit of the proposed purchase price.

Copeland Sports said one condition of the sale is that it close before the busy Thanksgiving holiday shopping period.

As a result, the auction will be held Nov. 16, and the sale hearing is scheduled for Nov. 17.

Copeland, a San Luis Obispo, Calif., regional specialty sporting goods retailer, filed for bankruptcy on Aug. 14. Its Chapter 11 case number is 06-10853.

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