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MC Sports files Chapter 11 bankruptcy, plans to close all 68 stores
By Caroline Salls
Pittsburgh, Feb. 14 – Michigan Sporting Goods Distributors, Inc., which does business as MC Sports, filed Chapter 11 bankruptcy Tuesday in the U.S. Bankruptcy Court for the Western District of Michigan.
President and chief executive officer Bruce Ullery said in a statement filed with the court that, despite the company’s pre-bankruptcy efforts to address its liquidity constraints, it was “ultimately unable to finalize a comprehensive and workable restructuring plan, leading to the filing of this bankruptcy case.”
Ullery said MC Sports has decided to proceed with a liquidation of all 68 of its stores. The company hired Tiger Capital Group, LLC and Great American Group, LLC to conduct store-closing sales.
The closing sales were expected to be officially launched on Feb. 14. Under a consultant agreement with Tiger and Great American, the sales must end by April 30.
The consultants will receive a merchandise fee ranging from 0% to 1.75%, based on the recovery percentage. In addition, the consultants will pay to MC Sports a 10% fee in connection with any additional merchandise sold.
In connection with the bankruptcy case, MC Sports is seeking court approval to use the cash collateral of its pre-bankruptcy secured creditors to fund its operations while in Chapter 11.
According to court documents, MC Sports has $50 million to $100 million in both assets and debt.
The company’s largest unsecured creditors are NIKE of Memphis, Tenn., with a $3.81 million trade debt claim and Under Armour, based in Baltimore, with a $2.45 million trade debt claim.
No other unsecured creditors were listed with claims of $1 million or more.
The company is represented by Warner Norcross & Judd LLP.
MC Sports is a Grand Rapids, Mich.-based sporting goods retailer. The Chapter 11 case number is 17-00612.
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