LOS ANGELES — Saddled with debt and unable to upgrade its stores, Sports Authority filed Wednesday for bankruptcy protection.
The Englewood, Colo., sporting goods retailer said it plans to get rid of nearly a third of its stores.
Sports Authority said in a statement that the move allows it to adapt to the "changing dynamics" of the retail industry, especially the growth of e-commerce. As part of the restructuring, the company said it has identified about 140 stores and two distribution centers in Denver and Chicago that it plans to sell or close over the next three months.
Sports Authority has 463 stores in 41 states and in Puerto Rico. There was no word Wednesday about whether any Connecticut stores would close.
Of the stores set to be closed or sold, 87 leases are already listed for sale, according to A&G Realty Partners, which is managing the sale of store leases.
The company is leaving the Texas market and listed 25 store leases for sale. It has listed eight store leases in Florida. The company said that because of the growth in e-commerce, it will not need as many brick-and-mortar stores in the future.
In a statement, Sports Authority Chief Executive Michael Foss said the Chapter 11 process will give the company the "financial flexibility to continue to make necessary investments in our operations."
Though Sports Authority controls about 5.6 percent of the sporting goods retail market, according to market research firm IBISWorld, it has struggled to upgrade its in-store experience and online presence.
The company took on a large amount of debt when it was acquired in 2006 by Los Angeles private equity firm Leonard Green and Partners.
"I think that was the biggest catalyst for them," said Matt Powell, a sports industry analyst with the NPD Group, a market research company. "They just weren't able to service that debt or find another way to mitigate that overhang."
Without adequate funds, the company was unable to take advantage of the thriving sporting goods retail market. Between 2010 and 2015, industry revenue grew at a rate of 2.4 percent per year, to $49.3 billion, according to IBISWorld. That growth is expected to continue at an annual rate of 1.6 percent to 2020, to $53.3 billion.
The growth in sporting goods has been driven by sneaker sales and athletic apparel in the past few years, especially as sports participation has increased.
"You have millennials that are really concerned about fitness and health," Powell said. "They're living healthy lifestyles."
Competitors have enhanced their brick-and-mortar stores to include more interactive experiences, such as rock-climbing walls or putting greens, and more customer service to encourage foot traffic, according to IBISWorld.
Powell described the in-store experience at Dick's Sporting Goods, which has 14.9 percent of the market, as "upscale."
"The stores are beautifully laid out and well-maintained," he said.
The majority of Sports Authority's stores are expected to operate "without change or interruption" during the Chapter 11 process, the company said.