Bury-based sportswear giant JD Sports is set to buy New York-listed US rival Hibbett in a $1.1bn deal, its biggest acquisition to date.
A historically aggressive acquisitions policy sees JD Sports operating in more than 30 countries including the US, where it already generates almost a third of its revenue even before the latest acquisition.
The purchase, set to be completed in the second half of this year, is JD’s fourth significant move in the US market, most recent was the 2021 acquisition of Baltimore-based DTLR Villa for $495mn. Prior to that the sportswear chain opened its first five US stores under the JD brand in 2018, following the $560mn purchase of Finish Line. JD also acquired Shoe Palace for $325m in late 2020.
The combined group following the Hibbert deal would have revenues of about £4.7bn in North America, JD Sports said, adding that the region’s contribution to global sales would increase to about 40 per cent..
JD Sports will pay $87.50 per Hibbett share in cash, a premium of about 21 per cent to the US company’s last closing price. Hibbett’s shares rallied 14 per cent to $86.4 in premarket trading on Nasdaq.
Alabama-based Hibbett has 1,169 stores located in 36 states across the US. In the year to February, it generated net sales of $1.7bn and pre-tax profit of $131.6mn.
Hibbett’s share of 80 per cent stores with street locations fitted well with JD’s other brands in the US, which were predominantly destination stores, said Schultz, adding that the acquisition would help JD on its quest to “cover the full country.”
JD shares, which took a dip at the turn of 2024 when the company issued a warning it would miss its ambitious $1bn annual profit target, were up more than five per cent on Tuesday following the announcement.
