Sports Authority wins final approval of DIP loan, store sale agreement

By Caroline Salls

Pittsburgh, May 3 – Sports Authority Holdings, Inc. received final court approval to access to $595.29 million in debtor-in-possession financing, according to an order filed Tuesday with the U.S. Bankruptcy Court for the District of Delaware.

As previously reported, the company will have access to up to $595 million in DIP financing, which, combined with cash from operations, is expected to provide sufficient liquidity during the Chapter 11 process.

Specifically, Sports Authority requested final court approval of a $500 million revolving credit facility. The company said its DIP credit agreement also provides for the issuance of a first-in, last-out (FILO) DIP facility, which will be used to refinance its pre-bankruptcy FILO loan.

The revolver will bear interest at Libor plus 325 basis points or Base rate plus 225 bps. The FILO facility will bear interest at Libor plus 790 bps with a 1% Libor floor.

The financing is scheduled to mature on June 30.

In addition, Sports Authority obtained final court approval to assume an agreement under which it will proceed with closing sales at 140 of its stores.

The company said the sales were scheduled to begin on Feb. 23 in accordance with a Feb. 17 liquidation agreement with Gordon Brothers Retail Partners, LLC and Tiger Capital Group, LLC and conclude by June 7.

Sports Authority, an Englewood, Colo.-based sporting goods retailer, filed bankruptcy on March 2. The Chapter 11 case number is 16-10527.

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