JD Sports to buy Hibbett in £899m deal

JD Sports has agreed to buy US sports fashion retailer Hibbett for £899 million.

The Birmingham, Alabama-headquartered company currently has 1,169 stores across 36 US states, where it sells footwear, apparel, and accessories from well-known sports brands including Nike, adidas, and Jordan.

JD Sports said the move forms part of its growth plans in North America, where it is continuing its rollout in the US, the largest sportswear market in the world.

The combined revenue of the two retailers in North America would be around £4.7 billion, increasing the region's share of group sales from roughly 32 per cent to 40 per cent.

"This acquisition is in line with our strategic priorities and is a very important transaction for our strategic and financial development," said Régis Schultz, chief executive, JD Sports. "Strategically, it enhances our presence within North America and achieves our objective of strengthening our Complementary Concepts division."

The chief executive went on to say that Hibbett's current footprint in the south eastern part of the United States will be beneficial to the company given that it currently has a limited presence in the area.

JD Sports expects to fund the purchase and refinance Hibbett's debt through a number of existing US cash resources of $300 million and a $1 billion extension to its existing bank facilities.

JD Sports' announcement comes after the sportswear giant completed the acquisition of a 40 per cent minority stake in Polish footwear and clothing retailer Marketing Investment Group (MIG) earlier this year, making it the sole owner of the company.

The takeover was part of the company's plans to accelerate the rollout of the JD brand in Central and Eastern Europe.

Last summer the company also announced it would enter the Middle Eastern market after penning a franchise deal with Dubai-based retail consortium Gulf Market Group (GMG).

The 10-year agreement will see GMG open around 50 stores under the JD banner by 2028, JD said, with a focus on locations in the United Arab Emirates, Saudi Arabia, Kuwait, and Egypt.

Despite JD Sports' international expansion plans, the company saw its shares tumble by more than 20 per cent in January following news that the sportswear retailer had lowered its full-year profit forecast.

In a trading update, the company said that high levels of “promotional activity” combined with higher costs and subdued consumer spending in the prior quarter had impacted its sales.

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