Gander Mountain, citing the need for a narrower focus and a lower-cost operating model, filed for Chap. 11 bankruptcy protection on Friday. Overton’s, a catalog and internet-based retailer of boating and other water sports products, is included in the bankruptcy. The 166-door retailer intends to close 19 percent of its locations, or 32 underperforming stores across 11 states, over the next two weeks as it prepares for a court auction of remaining assets late next month and approval of a final sale by May 15. Debtor-in-possession financing from Wells Fargo combined with cash from operations is expected to provide Gander with adequate liquidity while it re-organizes.  

“The company does not have the financial capacity or time to reset its operations to fully implement the new model and, as a result; The best available path forward is to sell the company on a going-concern basis,” according to a statement from Gander Mountain.  

According to court documents filed Friday, Hilco Merchant Resources will be the “stalking horse bidder” for Gander’s assets with another Hilco division acting as the retailer’s real estate advisor. The once publicly traded retailer, which is 45 percent-owned each by St. Louis-based Gratco/Rex Realty and Bloomington, MN-based Holiday Companies, has already installed investment bank Lighthouse Management Group’s Timothy Becker as chief restructuring officer.  

In a statement, Gander confirmed it’s in “active discussions” with parties interested in purchasing the retailer as a going concern. One possible suitor, according to a veteran market observer, could be discounter Walmart, which acquired the 10-door outdoor specialty chain Moosejaw Mountaineering, in January for $51 million. The combination of the more nationally-known Gander banner and outdoor specialty and ecommerce know-how of Moosejaw’s senior management team tied to the discounter’s systems, logistics and distribution expertise could make for a more potent player in the retail segment.

"The company does not have the financial capacity or time to reset its operations to fully implement the new model and, as a result; The best available path forward is to sell the company on a going-concern basis"

Meanwhile, there is a hearing tomorrow seeking bankruptcy court approval to allow Gander Mountain to pay $1.5 million in claims to its 15 identified “critical vendors.” In total, the retailer owes an estimated 1,760 vendors an estimated $115 million in aggregate. The retailer’s top 15 trade creditors are owed more than $43.7 million in aggregate with the top four owed more than $25.6 million in aggregate.  

Gander Mountain’s top 15 trade creditors with amounts owed are:
Vista Outdoor: $15,178,053
Pure Fishing: $4,546,217
Ellett Brothers: $3,032,840
Sigarms: $2,864,981
Remington Arms: $2,624,106
Starcom Worldwide: $2,244,233
Vortex Optics: $2,121,450
Liberty Safe: $2,013,223
Bill Hicks & Co.: $1,691,969
5.11 Inc.: $1,495,018
Sports South: $1,411,122
Benelli USA: $1,218,153
Smith & Wesson: $1,203,123
Under Armour: $1,072,122
Magpul Industries: $1,028,754
Normark: $979,865
National Retail: $952,253
Hydro Flask: 871,132
Carhartt: $855,696
Red Wing: $819,708

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