Prince Sports Inc, the oft-sold sporting goods company for the last ten years, has filed for bankruptcy, as reported by the Chicago Tribune, Reuters, the Wall Street Journal and other sources.
The company was known for its tennis rackets, indoor court sport's accessories and apparel. Most notably, their products were seen used by Maria Sharapova, Patrick Rafter, Martina Navratilova and Gael Monfils. The company was also known for creating the oversized tennis racquet.
Prince Sports Inc. was founded in 1970 and is based in Bordentown, New Jersey. Most of their products can be found in large retail stores such as Wal-Mart and Dick's Sporting Goods Inc.
The company has blamed the filing on growing competition, increased debt and the lowering of discretionary spending by consumers following the nation's financial crisis.
In the last 10 years Prince has had multiple changes in ownership. Lincolnshire Management purchased them from the Benneton Group in 2003. In 2007 Lincolnshire sold Prince to Nautic Partners.
In November of 2010, Prince engaged UBS to work on selling rights to its brands and operations in China. The process failed to come to fruition when it didn't gain the acceptable bids. Another sale was attempted in October of 2011. At that time Prince acquired Robert W. Baird for the transaction and he was able to secure nine potential investors.
However, that sale also fell through as three of the potential investors would have paid much less that the existing secure debt, according to the bankruptcy filing.
There are two product brands that Prince uses: "Ektelon" sells all of their racquetball racquets, footwear and gloves. "Viking Athletics" sell their platform tennis paddles, balls and gloves.
Assets are listed between $50 to $100 million and debt is listed at $65 million. The money, in secured debt, is owed to Authentic Brands Group (ABG)-Prince LLC. Approximately $10.2 million is owed in trade debt to vendors.
According to the bankruptcy filing, ABG-Prince is expected to become the owner of Prince, and will cancel the secured debt owed in exchange for 100 percent new equity in the company following its reorganization.
The ABG website states that their company is a brand development and licensing business. The company manages the Marilyn Monroe, Bob Marley and Polaroid consumer brands.
The Bankruptcy Court has to approve all of Prince's restructuring plans.
Prince plans to exit the bankruptcy with a more viable business model that will be able to challenge the competition.
Prince's chief executive officer, Gordon Boggis, stated, "We anticipate to emerge from this period as a more efficient, performance racquet sports brand with a more competitive model in the market, while eliminating the economic constraints that have prohibited the brand from achieving its potential."
The filing was made in the District of Delaware U.S. Bankruptcy Court.
Whether you are considering a business or personal bankruptcy, contact a bankruptcy attorney to best suit your needs. In these economic times, bankruptcy can sometimes be a welcome salvation that promises a brighter future.