More Than Half of Gander Mountain Stores To Close After Chain’s Sale
More Gander Mountain locations are likely headed to the chopping block, according to Camping World Holdings, an RV retail network operator and now owner of the St. Paul-based sporting goods retailer.
Lincolnshire, Illinois-based Camping World announced its victory in the bidding war for Gander Mountain’s assets on Monday. For just under $38 million, Camping World will assume control of Gander Mountain’s assets — pending approval — which includes the licenses to 162 retail locations, its corporate operations, intellectual property rights, its ecommerce business, and the entirety of its boating subsidiary Overton’s. The deal, however, does not include Gander Mountain’s inventory, only the inventory of its Overton’s business.
Investment firm Gordon Brothers and Hilco Merchant Resources, a consultancy specializing in divestitures, have instead been placed in charge of the liquidation, which could turn out to be a comparatively larger payday for Gander Mountain. Sources told Bloomberg that the local retailer could recoup as much as 91 percent of what it paid for its current inventory, or up to $430 million.
At the same time Gander Mountain applied for bankruptcy protection in March, it announced its intention of closing 32 stores in 11 states, including three in Minnesota. The current slate of closures would affect approximately 1,280 employees, but that number could grow.
“While we are obligated to assume a minimum of 17 leases, our destination rights will allow us to operate stores and retain employees at a number to maximize profitability,” said Camping World CEO Marcus Lemonis.
In an interview with the Wall Street Journal, Lemonis laid out the company’s plan, saying at least half of the stores would be shut down.
Camping World has not yet announced which stores would survive, nor if the stores would retain the Gander Mountain brand. However, Brent Moody, the chief operating officer of Camping World, noted that the company would “immediately right size the inventory” of certain Gander Mountain locations — meaning it would reformat or reduce in-store stock.
“The liquidation of the existing Gander Mountain inventory will allow us to start with a clean slate of what we consider the appropriate mix and levels of inventory,” Lemonis said in a statement, “including the addition of Camping World and Overton offerings where appropriate.”
Camping World also owns the Good Sam recreational vehicle dealership chain. The company made $203 million last year from approximately $3.5 billion in sales.
Shares of Camping World, which is traded on the New York Stock Exchange, rose 2.5 percent from Friday to end of day Monday, closing at $31.66.