Retailer West Marine prepares for possible bankruptcy

US-based boat retailer West Marine could be preparing to file for bankruptcy, according to reports in Bloomberg.

The news outlet, which cites “people with knowledge of the matter”, states the firm is laying the groundwork for a potential Chapter 11 bankruptcy to restructure its debt, including leases.

West Marine, which operates out of Fort Lauderdale in Florida, is among the largest American retailers of boating, fishing, sailing and paddling supplies, operating over 230 stores in North America and a major e-commerce site. The firm was founded in 1968.

The privately held company, currently controlled by asset management firm Oaktree Capital Management and private equity firm L Catterton, is reportedly planning to close “a number of locations”, according to the unnamed sources.

The same sources suggest that, while a Chapter 11 bankruptcy seems the most likely outcome for the restructuring talks, discussions are ongoing and no final terms have been made.

No official comment has yet been made on the reports, and the firm has so far not responded to media enquiries about a potential bankruptcy.

West Marine plans to move its retail operations towards an “omnichannel” model, integrating in-store and online sales, while adapting its physical outlets to better serve professionals in the boating sector, Bloomberg reported in April.

The restructuring discussions come about three years after West Marine completed a debt deal known as a liability management exercise, in which L Catterton agreed to subordinate its own borrowings in the repayment hierarchy and provide fresh capital to the retailer.