There are plenty of businesses that can and do compete with online, or do both (using their distributed inventory to reduce the time it takes to ship online orders).
But saddling a retail company with tons of debt makes much, much harder; profits that should be going to restock instead go toward financing the debt.
We don't really need to read tea leaves here to figure out the cause of death.
Business School 101: Whether you finance your inventory or pay cash doesn't actually make much difference if it doesn't move. Costco or Walmart or any other retailer that is successful right now also uses credit to acquire inventory. (Costco has $10 billion in rolling debt and Walmart has $60 billion, btw. Both seem to be doing fine.)
And again, the businesses that compete with the internet right now are doing it by keeping their inventory costs in check. They have either moved most of their "selection" to online-only, or they have done away with consistent inventory across stores.
But saddling a retail company with tons of debt makes much, much harder; profits that should be going to restock instead go toward financing the debt.
We don't really need to read tea leaves here to figure out the cause of death.