(CNNMoney) — Sports Authority filed for bankruptcy early Wednesday and said it will close 140 stores, nearly a third of its total.

The bankruptcy has been looming since January, when the company disclosed that it had missed a $20 million debt payment.

The store closings will take place over the next three months. The bankruptcy filing will allow it to break leases for money-losing stores. The company’s filing disclosed more than $1 billion in liabilities and assets valued at less than $50,000.


UPDATE: Sports Authority released a list of 143 locations (141 stores and two distribution centers) that are closing in the next three months. No locations on the list are in Hawaii.

The company says their stores will remain open and run on normal schedules during the Chapter 11 process.


The company was once the largest sporting goods retailer. But it has struggled with the debt load associated with a leveraged buyout a decade ago. It has been overtaken by Dick’s Sporting Goods, which has grown by providing a more high end shopping experience.

“Someone who wants to shop in a brick-and-mortar store and try on the baseball glove, or get the feel of a golf club, wants a better shopping experience,” said Larry Perkins, of SierraConstellation Partners, an expert in retail reorganizations. “That’s not Sports Authority any more.”

Sports Authority is just the latest retail giant to fall on hard times as more and more shopping moves online.

Circuit City went bankrupt in 2008, followed by Borders in 2011. Both eventually closed. RadioShack went bankrupt a year ago, and American Apparel filed in October, although both companies remain in business with fewer stores.

Store closings are a growing trend among troubled retailers not in bankruptcy, such as Sears. Even successful retailers such as Walmart are closing stores.

For Sports Authority, the online competition has come from online retailers such as Amazon and Fanatics, and also retail sites run by sports leagues such as the NFL and NBA.

“You used to go to Sports Authority or some other store to buy your fan gear. Now it’s much easier to find online,” said Perkins.

Sports Authority spends $6 million a year to have its name on the stadium that is home to the Denver Broncos, which just won the Super Bowl. Whether that 25-year naming rights deal will continue under the bankruptcy is unclear.

“This was a tough decision to make, but we believe it was a necessary step in our plan to make Sports Authority an even better partner for our customers,” said CEO Michael Foss.


A Message From Our CEO

March 2, 2016

Dear Sports Authority Customers,

During the past several months, we have been working very hard to adapt our business to better meet the needs of our customers. We are committed to evolving as a company so we are ableto continue to offer the best brands at great values – both in our stores and on our website, SportsAuthority.com.

With these goals in mind, we have decided to utilize the Chapter 11 process to implement a financial and operational restructuring that we believe is necessary to help us become an even better place for our customers to shop for sporting goods.

Due to the changing retail environment, we have a long-term plan to streamline and strengthen our business so we can continue to make necessary investments in our operations, including upgrading our in store experience and enhancing our website. As part of that plan, we have identified approximately 140 stores that we intend to close or sell in the coming months. This was a tough decision to make, but we believe it was a necessary step in our plan to make Sports Authority an even better partner for our customers. The store closings will occur over the next three months.

While no stores are being shut immediately, if the store where you regularly shop is ultimately closed, you can use the Store Locator on our website to find the nearest Sports Authority location. In addition, you always can find all of our brands at the same great values online at SportsAuthority.com.

Most importantly, I want to emphasize that our customers should not be affected by this restructuring process.

We do not expect there to be any impact on gift card balances or your ability to use gift cards at our stores or online at this time.

In addition, there should be no changes to our return/exchange policies at our go-forward stores or our customer loyalty program, The League.

If you have a warranty on a product you bought at Sports Authority, it is still in effect for the same period of time.

Finally, this should have no impact on the way you use your Sports Authority credit card or pay your bill.

In short, we are continuing to operate our stores and website, and we remain fully committed to delivering value and great brands wherever you shop at Sports Authority.

If you have any questions, or would like more information about the Chapter 11 case, including access to Court documents, please visit www.kccllc.net/sportsauthority or call the information line at:

Toll Free (USA and Canada): 866-967-0490

International Callers: 310-751-2690

Thank you for your continued support!

Sincerely,

Mike Foss

Michael Foss,

Chief Executive Officer