Landmark La Cañada Flintridge sporting goods chain Sport Chalet Inc. is being sold to Vestis Retail Group, creating one of the largest sporting goods retailers in the country.
Vestis, which owns East Coast sports retailers Bob's Stores and Eastern Mountain Sports, said it will buy all outstanding shares of Sport Chalet for $1.20 per share. Vestis is owned by Philadelphia-based Versa Capital Management.
FOR THE RECORD
July 1, 4:47 p.m.: An earlier version of this post said Vestis owns retailer Bob's Sporting Goods. It owns Bob's Stores.
Based on the total number of outstanding shares listed in a company filing, the sales price would be $17 million. The company had $52.4 million in debt at the end of the quarter, according to a securities filing. Including debt, the deal would be worth about $70 million.
Sport Chalet declined to comment on the sales price.
The sports retailer first opened in 1959 as a small ski and tennis shop in La Cañada Flintridge and has since expanded to Nevada, Utah and Arizona.
The iconic Southern California sporting goods retailer has struggled in recent years, battling back from the recession in an increasingly competitive market for sports gear.
With the addition of Sport Chalet's 51 stores, Vestis said it will have a national hold in the sporting-goods market. All three chains will keep their original names but combine sales lines, the company said.
Competing against retailers such as Big 5 and Dick's Sporting Goods, Vestis said it plans to combine Sport Chalet's back-office and online logistics operations with the Eastern Mountain Sports chain in the Mid-Atlantic states and Bob's Stores in the Northeast, "to create one of the largest sporting goods retailers in the U.S." with more than 150 stores.
Versa said it will borrow $180 million to help build up the combined chains.
"Sport Chalet greatly strengthens our position in the active lifestyle and outdoor categories, provides scale from which to grow, and diversifies our geographic footprint," said Mark Walsh, Vestis chief executive.
The price per share is a premium to Sport Chalet's recent trading price around $1.12 per share.
Sport Chalet will retain its president and chief executive, Craig L. Levra, who will report to Vestis from La Cañada Flintridge.
Vestis' headquarters will remain in Meriden, Conn., and the company said it does not expect to close any Sport Chalet stores.
Versa also owns Avenue Stores, Black Angus steakhouses and the Civitas Media community newspapers.
Founding members of Sport Chalet and some company executives have already agreed to sell their shares to Vestis.
The deal is expected to close during the third quarter.