Working with liquidators, Dick’s Sporting Goods’ has reportedly secured the U.S. business of Golfsmith International Holdings Inc. with an approximate bid of $70 million during a bankruptcy auction held Friday. Reuters reports that Dick’s will be taking over Golfsmith’s stores, intellectual property and inventory.
In addition to operating golf retail stores, Golfsmith International is the former owner of Accolade Promotional Group, a Top 40 Canadian distributor that was acquired last year by Staples, Inc., the parent company of Staples Promotional Products (asi/120601). In 2014, Golfsmith International consolidated its Golf Town Corporate Sales and Golfsmith Business Pro Shop teams under Accolade and made its entry into the U.S. market.
Quoting sources familiar with the bid, Reuters reported that Dick’s will keep at least 30 Golfsmith stores open and retain about 500 employees. The remaining golf specialty shops will, ultimately, be shuttered. When Austin, TX-based Golfsmith filed for bankruptcy last month, the retailer had 109 stores in the U.S., but has already begun closing shops.
Liquidators from Hilco Global and Tiger Capital Group have teamed up with Dick’s, which operates its own golf shops (called Golf Galaxy) in addition to its namesake sporting goods stores. It remains uncertain if the Golfsmith shops will be renamed – something that could be determined as Dick’s awaits final approval on the results of the bankruptcy auction from a U.S. bankruptcy court judge.
Last month, Golfsmith announced that it was selling its retail Golf Town Canada shops to a group led by Fairfax Financial Holdings Ltd. and CI Investments Inc. Golfsmith filed bankruptcy in the U.S. and Canada due to heightened competition from discount retailers like Walmart and Amazon, and because sales were impacted by younger consumers’ diminishing interest in golf, Reuters reported.
Based in the greater Pittsburgh area, Dick’s has been in spending mode in 2016. Earlier this year, the Fortune 500 retailer won another bankruptcy auction for some assets, including certain store leases, of its one-time rival Sports Authority.