UFA DEAL PARTIALLY UNRAVELING
Sportsman’s Warehouse Closing 23 Stores
Aurora, Pocatello and Nampa stores on chopping block; other Idaho and all Montana stores to remain open; UFA to own 15 stores.By Bill Schneider, 3-11-09
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UPDATED 6 pm, March 11, Update at end of article.
The pending purchase of Sportsman’s Warehouse by UFA Co-operative United (UFA) of Calgary, Alberta has partially unraveled. (Click here for NewWest.Net’s breaking story on the acquisition.)
In a teleconference with all Sportsman’s Warehouse employees yesterday afternoon CEO Stu Utgaard announced that 23 of the company’s 67 stores would be closing in the next few months, including two stores in Idaho (Pocatello and Nampa) and one in Colorado (Aurora). Other Idaho stores and all Montana stores would remain open.
In a phone interview with NewWest.Net, Utgaard explained that the company ran in to major cash crunch. “UFA did not close the transaction,” he explained. “They missed four closing dates. Now, we have no liquidity.”
And the banks are putting extreme pressure on the company to reduce debt, he said. “They have all the money. They (the banks) are trying to force us into bankruptcy, and we’re trying to avoid it.”
“We’re closing 23 stores to reduce our bank debt,” he explained, “and we’re selling 15 stores to UFA for the same reason. We are now a 29- store chain.”
In the teleconference, Utgaard said UFA will have the rights to use the Sportsman’s Warehouse brand on the 15 stores for up to two years, but will likely start the process of re-branding the stores as Warehouse Sports, a similar Canadian sports store chain UFA already owns.
These 23 stores are being liquidated: Aurora, CO, Coon Rapids, MN, DePere, WI, Henderson, NV, Lafayette, IN, Las Cruces, NM, Las Vegas, NV, Legacy, TX, Memphis, TN, Nampa, ID, New Berlin, WI, Oklahoma City, OK, Pittsburgh, PA, Pocatello, ID, Roanoke, VA, Rogers, AR, Round Rock, TX, St. Cloud, MN, Sioux Falls, SD, Southaven, MS, Visalia, CA, Wichita, KS and Woodbury, MN
These 15 stores are being sold to UFA: Bend, OR, Bozeman, MT, Burlington, WA, Coeur d’Alene, ID, Fargo, ND, Federal Way, WA, Helena, MT, Kennewick, WA, Lacey, WA, Missoula, MT, Portland, OR, Salem, OR, Silverdale, WA, Spokane, WA, and Vancouver, WA
NewWest.Net has calls into the corporate offices of UFA for comment and will update this story if more details come in.
UPDATE, 6 pm, March 11: After repeated attempts to get a comment from UFA for this story, NewWest.Net received a prepared statement from UFA tonight. In the statement, UFA said that after a “ comprehensive due diligence process” coupled with the “continuing deterioration of the North American economy,” UFA has decided not to pursue the acquisition under the original terms. Instead, UFA has agreed to take possession of 15 stores in Montana, Idaho, Oregon and Washington in exchange for the first payment already made to Sportsman’s Warehouse as part of the original acquisition deal.
“We cannot predict the future for Sportsman’s Warehouse,” UFA CEO Dallas Thorsteinson announced in the release, “but we are certain the acquisition of these specific locations is good news for the growth and sustainability of UFA.”
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Comments
For more on why more national chains will fail (it's not just the economic downturn), I'll blatantly plug my own recent piece in the S.F. Chronicle: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/01/04/INA8150K55.DTL&hw=milchen&sn=001&sc=1000
Sportsman's built six stores a year-got greedy, overbuilt. I personally like their stores better than Cabela's tourist traps.
chas
As for dropping of Cooper, I am not sure that has truly happened, We still have Cooper firearms and we have few in stock that I do not recognize so we may be getting new ones in...I could be wrong however
As for Sportsman's Warehouse and Cooper, I have personally boycotted the Sportsman's Warehouse for punishing Dan Cooper and his employees for exercising his right to free speech (that's a Constitutional Amendment too ya know). I may have misspoken when I said they dropped Cooper Firearms. Rather, I believe they and other dealers initially said they would drop his firearms, forcing Dan to sell his company and step down. If I am wrong, and Sportsman's Warehouse never threatened to pull Cooper Firearms I am sorry for boycotting their store. Regardless of their statements and policies regarding Cooper Firearms, I am sorry for the employees and families of Sportsman's Warehouse that have lost their jobs.
And GI Joe's in Oregon got their name changed by new owners to Joe's (marketing genius at work) and are now in receivership. I didn't even bother to go through their door.
Fishing, hunting, skiing, all are discretionary spending and when you are losing jobs in your state by the thousands each week, there is little money being spent on sporting goods, cars, boats, and happy times stuff. The new vacation is a trip to Burritto King and a movie. All the while the legislatures are finding ways to raise license and fee costs, tax everything that a human might need or use, and bring on some new entitlement programs to kill any hope for economic recovery.
It looks to me, in reading how the Canadian co-op is stating things, the stores that are left are going to be more farm supply than sporting goods. They get the buildings, the locations, and all they have to do is sell horse dope, buckaroo Bob clothing, and dog food along with some fishing rods and guns, and that will be the new look. They can buy in bulk and beat the local outlets. Price is king today.
I hope they have a Victory garden center, and I can buy some chickens so mother and I can sell eggs to the neighbors. I will use my single shot .22 with bird shot to fend off the raptors wanting my birds...and snattlerakes...the nest raiding 'coons. That is the new urban deal, you know. People in town don't want pit bulls, but they do want to be able to have 4 laying hens...."they're laying eggs now, just like they use-ter, ever since that rooster, came into our yard....."
But the lack of guns and bullets on the shelves is something. Anywhere you go. Did the Bubbas do an Obammer Horde? Is this the anti-Pelosi phenom? It appears the shoot 'em up crowd got theirs, and the rest of us dummies will have to wait for the ammo makers to produce some more....and meanwhile, the likes of Sportsman's Warehouse, the old boys toys, is gone in many places...not having bullets and ammo to sell can do that to you...
But when a corporation decides not to pay there bills. Then what do you expect. I have worked for sportsmans warhouse for over a year and a half. And I have never seen a buisness try to work so hard to build a big buisness just to try to sell it at the brink of Bankruptcy. I really wish that Stu would have ran the buisness just a little more conservative. because of his buisness stratagy 23 stores worth of employees will lose there jobs and that really sucks. Tell me about it. I would be one of those people if it wasn't for UFA.
So for UFA to come in and help. I appreciate it a lot. I could see things getting worse before they get better. But that is what happens when a new owner takes over. I will just for now sit back and take a big sigh of relief over the situation.
Your pragressuv citay boy sophistimification is enbritunin us feer mongerin country folk and our gun lobbee.
Thanks
P.S. Pull your head out.
Come on, google the name and you'll find out what is the correct spelling.
Basic....
In terms of the gift cards, we do have an official position that I've been communicating since about noon. I also understand it is to be posted in the 15 stores we now own. The statement is:
We appreciate the fact that you purchased Sportsman's Warehouse gift cards from the owners of the original company. UFA has purchased 15 of their locations, but does not have any affiliation with Sportsman's Warehouse.
At this time, we are not able to redeem Sportsman's Warehouse gift cards at the 15 locations UFA purchased yesterday.
Please note that Sportsman's Warehouse gift cards can still be redeemed at stores owned by the original company and online. Please go to http://www.sportsmanswarehouse.com for those locations.
As you can appreciate, Sportsman's Warehouse is facing challenging times and is closing 23 stores; UFA bought 15 locations, though if we had not, some of those stores may have closed as well.
UFA has a long tradition of serving customers and members and we will work very hard to deliver excellence for the customers of our newly acquired outdoor adventure stores in the US Northwest.
The locations UFA now owns are:
Bend, OR
Bozeman, MT
Burlington, WA
Coeur d’Alene, ID
Fargo, ND
Federal Way, WA
Helena, MT
Kennewick, WA
Lacey, WA
Missoula, MT
Portland, OR
Salem, OR
Silverdale, WA
Spokane, WA
Vancouver, WA
The fact they are "unable" to redeem the cards is disingenuous. If they really cared, they would have been "willing" to make an arrangement with SW to get reimbursed for any card transactions at UFA owned stores. This is just a copout.
Regarding UFA's appeal for us to "appreciate" the difficult times SW is facing, I can only hope SW appreciates the cash they now have from all those folks who purchased cards in good faith.
The ultimate irony, or insult, is the statement about redeeming the cards online or at another store. If you go to SW website, the online shopping link informs you they do not have an online catalog, but hey, you can order more gift cards on the page. You'd think a company on the verge of bankruptcy would be finding ways to keep what few customers they still have, instead of blaming banks for their mismanagement. I guess folks can all drive to Billings, since just about every other former SW store in the region is a UFA store now.
For me, both these organizations have lost my future business.
The truth is that the cards are still redeemable at any of the SW stores AND redeemable online which is where 75% of the people know how to shop anyway. It might be slightly less convenient but at least they can still redeem the cards. Better than what I got at Subway the other day when I went to redeem my rewards card only to find out that they had done away with it and I was just OUT three free foot longs. I think we need to give credit where credit is due. UFA IS getting the short end of the deal in a lot of this thanks to SW.
The other thing a customer can do is call the SW store that is still open and I bet they could do a phone order. The people who have the gift card aren't out the money, it is the people who purchased it for them. Regardless, not UFA's fault.
I guess if people want to try to hurt the community they live in by not shopping there, they have that right. Me for one, I know and care about alot of the employees who work at the local stores and will do my best to support their employment.
No my complaint is with the two entities who struck this deal. Regardless what could or could not be done in the discussions between UFA and SW, customers with gift cards are left high and dry. I agree the majority of the burden to reconcile this rests with SW, but I am surprised UFA didn't take a more proactive position in trying to bridge the gap - if for no other reason than to seize the opportunity to generate some good will. I didn't find their official statement very sympathetic to those customers who they are inheriting from SW
If you want to see how others are weighing in on this topic, check out the forum at http://www.ifish.net/board/showthread.php?t=240332
We should all remember 25 years or more ago, when the farmer in Missouri put his wheat crop in the elevator for storage, and the elevator went bankrupt. The bankruptcy judge declared that the wheat was collateral in the bankruptcy. The elevator had been paid to store it. The elevator had no interest but a storage lien. And the judge told the farmer that the wheat would stay there until the bankruptcy had wound its way through the court, and the wheat could be sold to pay bills to claims against the elevator. Well, that was one of those deals where the farmer did not have his crop for the year, and no money. He was going to lose his farm, his equipment, with the money to pay it being confiscated by the bankruptcy judge. So, he rallied his fellow farmers, went to the elevator, with half the trucks in the county, and they hauled his wheat away. Cut the Federal lock to do it. The farmer was arrested, and went to jail. Saved his farm. Sold his wheat. Did some time. He made thousands of dollars for every day he spent in jail.
We have no idea where the SW assets are at this time. Who owns what and owes how much. But the co-op can't take on bad business. They have to pay their own bills, purchase their own inventory. And the SW store in Salem, Oregon is lacking in inventory, and stuff has been moved around to cover the bare spots. And UFA can't suffer surprises in today's confused business economy. I am thankful they exist and are keeping the old boy's toy store running. We need one out here that is about the fish and game we have in this area...Walmart has never got that right.
Thanks all for setting me straight. I'm packing my unpatriotic a.. up and heading out - or at least from this comment string.
The new owners UFA have done nothing to get my business. I am not sure how Sportman has tied their hands in this. It is up to UFA as to what they do from now on out. I am not sure where Kathy comes up with the idea that they are trying to benefit themselves and US at the same time. Show me a decision where they are doing something to benefit US.
I do not see it.
Randy
UFA is taking on 15 stores because they think they will make money. They are not doing it out of the goodness of their heart. They are trying to make money.
When you purchase a business, you are purchasing the assets, debt, and the customer base. The customers are not obligated to do business with the new owner.
If I understand you, you want me to take the $300 hit on the gift cards that were purchased at the Missoula location, and feel patriotic that UFA is keeping the doors open.
Exactly what am I not trying at. I have not curbed my sporting goods purchases. I am not taking my money out of the economy.
On another forum I read a thread by Mark from UFA. He said that as of yesterday, they are trying to work something out with SW to accept the gift cards. If they do, I will continue to do business with them.
In the last three years my family and I have purchased over $15,000 of stuff from the SW store here in Missoula. Just last christmas, my father purchase 3 sets of Swarovski Binoculars for gifts. That purchase alone was $4000. I enjoy shopping in the store, but everything they have can be had at the other 3 locally owned stores. Not being able to redeem the gift cards puts a very bad taste in my mouth.
If the gift cards are such a big deal, you would think that the issue would have been addressed prior to the deal to purchase the stores and the customers would not have been blindsided by this.
I understand that you want your family to work as long as they can, but if it were me, i would be putting in applications elsewhere
"Thank you for your patronage of the Missoula store.
This gift card situation has changed a bit over the past couple of days. We are working very hard to negotiate a resolution with Sportsman's Warehouse corporate in Utah and hopefully will have something done by early this week.
Customers are very important to our businesses in Canada and we feel the same way about the customers of our newly acquired outdoor adventure stores in the US Northwest.
If you can be patient with us for a couple of more days, we hope to have a resolution for you.
If you have further questions, don't hesitate to email me.
We're sorry for the inconvenience and upset this issue has caused.
know if you have a sportsman warehouse in Reno Calif.
Do you have a Phone number or a address?? I really liked the one
in Visalia Calif. ( Thanks Jim Williams )
I will be traveling to Reno in approx 2 weeks. Can you give
me address or phone number to that location ?
I wanted to check on a product . and i dont want to go to a store unless it has what I want to see.
thank you
DOUG JONES
THE COMPETITION TO KEEP PRICES AFFORDABLE.