Sports Authority is preparing to file for bankruptcy, according to a Bloomberg report that cited sources with knowledge of the situation.
The sporting goods retailer has a debt payment due in less than two weeks and is discussing a reorganization deal with lenders, the sources told the news service. Part of the plan includes the previously rumored move to close as many as 200 of its roughly 450 stores.
In January, there was speculation that Sports Authority would be preparing to shut almost half of its locations, sending shares of competitor Dick's Sporting Goods higher. It was estimated that Dick's could gain $238 million on its rival's store closings due to rapid same-store sales growth and regained market share.
On Jan. 20, Moody's downgraded Sports Authority's credit rating after it missed a subordinated debt interest payment due on Jan. 15. The retailer was given a 30-day grace period.
Representatives for Sports Authority declined to comment to Bloomberg.
— Reuters and CNBC's Krystina Gustafson contributed to this report.