Objections to a “stalking horse bid” by a joint venture of The Sports Authority and Hilco Real Estate for the Copeland Sports chain have surfaced from at least one competitor.
Crystal Capital Fund Management and The Great American Group — the latter of which oversaw going-out-of-business sales at 11 stores already shuttered — said in a Nov. 6 court document that they were interested bidders but that Copeland “to the exclusion of other bidders” spent significant time aiding TSA and its agents to put together and position a bid to make that group the stalking horse bid, or the initial bid and the one to beat by others.
The statement goes on to say that Crystal and Great American have been working with Sport Chalet to develop a proposal “that will provide more value to the debtor” than the current bid. However, the statement notes that a Nov. 13 deadline is “simply too soon” for them and others to fully analyze information and to submit a meaningful bid.
The document requests a bid deadline of Nov. 17, with an auction for Nov. 20 so the sale can still close before Thanksgiving.
Copeland Enterprises responded on Nov. 7 that the objecting parties “lack standing to object” and in fact have had extensive access to information and the time to prepare a bid. The Copeland document also noted that the delay requested by the objecting parties would put at serious risk the timely approval of a sale needed to maximize value.
“In short, the objecting parties have already received a tremendous amount of relevant information and data and will have adequate time under the proposed procedures order to formulate a qualified bid, if any, in time for any auction. Any claims to the contrary are baseless or due to their own delay,” the Copeland court papers summarized.
It is yet to be seen if the Crystal/Great American group, or any other entity, will file a competing bid.
The court had set Nov. 16 as the date for an auction if other qualifying bids are received, with a hearing set for Nov. 17 to approve the successful bidder in the demise of the 35-year-old family sporting goods business that filed for Ch. 11 bankruptcy reorganization in August. A San Luis Obispo Tribune story stated that Sports Authority would do away with the Copeland name in the stores it would acquire; Hilco had already stated it would remarket or close the stores it wins.
The sale came about after John Brincko, of Brincko & Associates, which consult on restructuring, turnarounds and liquidations, took over as Copeland CEO in mid-September and said that selling was the best strategy.
To read a Nov. 3, 2006, SNEWS® story, “Copeland family selling, Sports Authority/Hilco ‘stalking horse bidder,'” click here.