Sport Chalet Founder Sets Stock Plan
By DEBORAH BELGUM
As the sports equipment industry becomes increasingly cluttered, closely held Sport Chalet Inc. is trying to give investors a clearer indication of the company’s future plans.
Norbert Olberz, the 77-year-old founder and principal stockholder in the La Canada Flintridge-based retailer, has announced that his 66 percent ownership of the sporting goods chain will be sold to the firm’s management upon his death.
Vice president and chief financial officer Howard Kaminsky said Olberz is in good health but the announcement was made to assure investors there would be a smooth transition and that the company intends to expand. The firm’s management has created its own company, SC Option LLC, to buy out Olberz, who serves as chairman emeritus.
Olberz started the company in 1959 when he bought his first sporting goods store in La Canada Flintridge for $4,000. The company now has 28 outlets, mostly in Southern California.
“The transition is the single biggest question that comes up for many investors in Sport Chalet,” said Kaminsky. “The end result is that management has the option to buy the company at its market value (at the time of Olberz’s death). People now understand that management has a stake in continuing to operate the company and to grow.”
The chain, whose 2002 revenues totaled $227 million, opened only two stores in 2002 and three stores in 2001. Sport Chalet will open a few more stores in 2003, but Kaminsky would not reveal the new locations. “Timing-wise, the announcement was not made because of the stock market or competition,” he said. “It was just on our list of things to address.”
Retailer Big 5 Sporting Goods Inc. in El Segundo plans an aggressive expansion after going public last August. The company, which has more than 260 stores, is scouting for locations to build a new warehouse to replace its 440,000-square-foot facility in Fontana to handle future growth.
Galyan’s Trading Co., a rapidly growing sporting goods chain out of Indiana, has been opening gigantic 80,000 to 100,000-square-foot stores nationwide, but none so far in California.