Sportsman's Warehouse acquired and closing stores!

The deteriorating economy has drastically altered plans for a Canadian co-operative to buy 80 percent of Sportsman's Warehouse, a Midvale-based outdoors company.

Instead, Sportsman's Warehouse is closing 23 stores in 17 states and selling 15 other stores in the northern United States to UFA Co-operative Ltd., based in Calgary.

While its four Utah stores - in Midvale, Provo, St. George and Riverdale - will remain open, about 150 Utah employees are among 2,000 people losing jobs companywide.

And the blood-letting might not be over.

"I need to find a new bank, and a new credit line, and I probably need to identify a new equity source of about $30 million, and I need to do it in a short time," Sportsman's Warehouse Chairman Stuart Utgaard said Wednesday.

"It's a terrible time and a terrible situation," he added. "Let's just say we didn't get our share of the bailout money."

Utgaard said the store closures and sales will reduce company debt by more than $100 million. He expressed hope those two actions will allow Sportsman's Warehouse to "go forward as a viable entity" with 2,300 employees at 29 remaining stores.

But he was far from certain about that Wednesday, saying he was "trying to salvage things from the past four months when UFA had control of our company."

In November, the cooperative started in 1909 by Canadian farmers announced plans to buy a majority interest in Sportsman's Warehouse. UFA already had made an investment in the Midvale company and hoped to complete the purchase by now. But because of "the continuing deterioration of the North American economy," UFA spokeswoman Natalie Dawes said, "UFA has decided not to pursue the acquisition under the original terms."

For Sportsman's Warehouse, Utgaard said that meant "UFA failed to complete their equity infusion, missing three closing dates." Meanwhile, banks stopped lending money, suppliers stopped shipping goods and company inventories - the basis for obtaining credit - shrunk by $120 million.

"Today we find ourselves in a very difficult spot," he added. "It breaks our hearts to lay these people off because they all have mortgage and rent payments, car payments and have to buy groceries."

UFA President Dallas Thorsteinson said the co-operative is taking possession of the 15 Sportsman's Warehouse stores in exchange for its original loan. The outlets in Washington, Oregon, northern Idaho, Montana and North Dakota "align nicely with our western Canadian geography and distribution routes.

"We cannot predict the future for Sportsman's Warehouse," he added, "but we are certain the acquisition of these specific locations is good news for the growth and sustainability of UFA."