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Sports Authority files for Chapter 11 bankruptcy protection

<p>Once a heavy-hitter in the sporting goods retail business, Sports Authority has fallen on tough times.</p><p>The retailer filed for Chapter 11 bankruptcy on Wednesday and announced it will be forced to close or sell roughly 140 of its 450 stores nationwide.</p><p>CEO Michael Foss <a href="http://www.sportsauthority.com/Landing-Pages/Press-Release/shop.jsp?categoryId=90463876&ab=MYOAS_AboutUsPage_PencilBanner_KEY_Ch11Announcement_030216_LRN_0_NA_TXT_NPCNS" target="_blank">said in a statement</a>, "Due to the changing retail environment, we have a long-term plan to streamline and strengthen our business ... including upgrading our in store experience and enhancing our website."</p><p>Some of those 140 stores could be sold to Dick's Sporting Goods, which has only grown while Sports Authority struggled.</p><p><a href="http://www.bloomberg.com/news/articles/2016-03-02/sports-authority-files-bankruptcy-after-bungling-fitness-boom" target="_blank">Bloomberg blames the Sports Authority's slump</a>, in part, on missing the opportunity to "exploit the fitness boom."</p><p>The outlet said, "As big-box giants and online merchants encroached on clothing stores and consumer electronics chains, sports were one of the few healthy areas."</p><p>Sports Authority's been hounded by debt in recent years following its $1.3 billion acquisition by private equity firm Leonard Green & Partners.</p><p>The bankruptcy filing isn't a total shock since the Englewood, Colorado-based company missed a $20 million interest payment in January. Reports indicated then that a bankruptcy filing in March was possible.</p><p><i>This video includes clips from </i><a href="https://www.youtube.com/watch?v=3NVW833OZZQ" target="_blank"><i>Sports Authority</i></a><i>, </i><i><a href="https://www.youtube.com/watch?v=JOJ01KXTw-A" target="_blank">Dick's Sporting Good</a></i><i> and </i><a href="https://www.youtube.com/watch?v=-ieLhPXPrMk" target="_blank"><i>KMGH</i></a><i> and images from Getty Images and </i><i><a href="https://www.flickr.com/photos/raybouk/8614661853/" target="_blank">Ray Bouknight / CC BY 2.0</a></i><i>.</i></p>
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NEW YORK (AP) — Sports Authority is filing for Chapter 11 bankruptcy protection.

The retailer said Wednesday that it plans to close or sell about 140 stores and two distribution centers, in Denver and Chicago. The Englewood, Colorado, company has 463 stores in 41 states and Puerto Rico. The store closings are expected to take up to three months.

Sports Authority stores will remain open and run on normal schedules during the Chapter 11 process. The company's website will continue to function, and the chain plans to honor warranties on items purchased at its stores or online.

"We are taking this action so that we can continue to adapt our business to meet the changing dynamics in the retail industry," CEO Michael Foss said in a written statement. The executive said that it needs fewer stores as consumers are increasingly shifting to online shopping.

The retail industry as a whole has struggled with the consumer move to online shopping, trying to find ways to lure customers to brick-and-mortar stores instead. Macy's Inc. has opened Macy's Backstage, in order to go head to head with discount retailer T.J. Maxx. And J.C. Penney Co. is using store-label offerings to fight against pricing pressures from online rivals and recently launched a new campaign called "Get Your Penney's Worth," which offers certain store-label items for pennies.

In a letter to customers posted on the company's website, Foss said that Sports Authority's long-term plan includes upgrading stores and improving its website.

Foss said that The Sports Authority Inc., which is privately-held, has received interest from third parties that may want to invest in or buy some or all of the business. The company plans to continue evaluating all of its options, he added.

Sports Authority said that it expects to have sufficient liquidity during the Chapter 11 process when factoring in cash from operations and anticipated access to up to $595 million in debtor-in-possession financing.

Sports Authority made its Chapter 11 filing in the United States Bankruptcy Court for the District of Delaware.

Copyright 2016 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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