Gander Mountain, the nation's largest chain of outdoors specialty stores, filed Friday for Chapter 11 bankruptcy protection from its creditors with the aim of selling the business.

The company, which is seeking a buyer, said it will be closing 32 of its 162 stores in the next few weeks.

Reports began circulating in January that the St. Paul-based company was suffering financially, with some vendors not being paid.

In a written statement, Gander Mountain said the filing was prompted by a realization that the company lacks the capacity to reposition its faltering outlets and that the best way forward is to sell the business "on a going-concern basis."

"The court's protections will enable us to manage the sale process on an expedited basis while protecting the interests of our customers, employees and other stakeholders," Gander Mountain said.

Gander Mountain said it is in active discussions with several potential buyers and expects to hold an auction in late April, with an anticipated closing by May 15.

Outdoor and sporting goods chains have struggled of late. Cabela's is being acquired by Bass Pro Shops. Eastern Outfitters, owned by Eastern Mountain Sports, filed for bankruptcy last week. Sports Authority declared bankruptcy and closed 300 stores last year.

Gander also filed for bankruptcy Friday for Overton's Inc., a wholly owned subsidiary in North Carolina that sells boating gear and outdoor equipment through the internet and catalog sales. Gander tried selling Overton's last year to help the company address its financial problems, but no buyer was found.

Gander said it is closing 32 "underperforming" locations in 11 states, including three Minnesota outlets located in Rogers, Mankato and Woodbury. Also closing are Wisconsin stores in Eau Claire and Germantown.

Gander has been discounting all of its online inventory for more than a month, with typical price reductions of 15 to 25 percent.

Despite the challenges facing big-box retailers from online sellers, some creditors believe Gander Mountain can survive in some form.

"Gander Mountain is a good company and it has a long legacy," said Jens Welin, executive vice president of Starcom Worldwide, a Chicago media agency that was listed as one of Gander Mountain's biggest creditors. "There has been a lot of turbulence in the market with all of the consolidation. We are hopeful that Gander Mountain will get back on track and become successful again."

The privately held company is controlled by David Pratt, a businessman and outdoors enthusiast from St. Louis, and the Erickson family, which also owns Holiday Station stores. According to the bankruptcy filing, Pratt's Gratco LLC owns 44.6 percent of the stock, with the Erickson family's Holiday Cos. owning 44.8 percent. The remaining shares are owned by another Holiday company and two other members of Pratt's family.

Gander Mountain does not disclose financial data, but Dun & Bradstreet estimates the company's annual sales at slightly more than $1 billion, with 5,605 employees nationwide.

Gander Mountain, which was founded in Wisconsin in 1960 as a catalog operation, has struggled for decades.

It first filed for bankruptcy protection in 1996. Holiday, which at the time had 10 retail sporting goods stores, bought all of Gander's 17 stores and began operating all the locations under the Gander Mountain banner.

But as the company expanded, it remained hamstrung by a deal it made to sell its direct-marketing division and some trademark licenses to rival Cabela's for $35 million. The deal included an extended noncompete clause that dogged the new Gander Mountain for years, as the retailer was unable to create a website or publish a catalog until 2008.

In 2010, Pratt and Erickson took the company private after five straight years of financial losses. The investors bought out the stock of minority shareholders for an estimated $25 million to $30 million.

Since then, the company has expanded significantly into the firearms market, opening gun-themed stores around the country. It also revamped more than half its stores to create a more friendly environment for shoe shoppers.

In its bankruptcy filing, Gander Mountain listed liabilities of more than $500 million. Its list of unpaid vendors features some of the biggest gun makers in the U.S., including Sig Sauer, Remington and Smith & Wesson. The largest unsecured creditor is Vista Outdoor Sales, a California footwear and sporting goods manufacturer that is owed more than $15 million.

Gander Mountain has a $30 million loan and revolving credit lines totaling $525 million, but it was not clear how much of the credit line is being used. Houlihan Lokey Capital, a Minneapolis firm specializing in mergers and acquisitions, has been hired to advise the company, and Lighthouse Management Group will oversee the restructuring.

Jeffrey Meitrodt • 612-673-4132

John Ewoldt • 612-673-7633