JD Sports has entered into a binding agreement to acquire US sportswear brand Hibbett for £899m.


Source: Lisa Byfield-Green

In a statement to the City this morning, JD Sports said it expected to fund the acquisition, and refinance Hibbett’s existing debt “through a combination of existing US cash resources” of $300m (£243.1m) and a $1bn (£810m) extension to its American banking facility.

Hibbett is headquartered in Birmingham, Alabama and currently operates 1,169 of its main Hibbett and City Gear fascia stores across 36 US states.

In the 53 weeks to February 3, 2024, the US sportswear retailer had net sales of $1.7bn (£1.38bn), EBITDA of $186m (£150.7m), profit before tax of $131.6m (£106.2m) and gross assets of $909.2m (£736.8m).

JD Sports said the acquisition represents an “important strategic milestone” for the brand as it looks to accelerate its “growth plans in North America” and the “biggest and most attractive sportswear market” in the world.

On a pro forma basis, JD Sports and Hibbett’s combined revenues in North America would be approximately £4.7bn, which would increase the group’s US sales by approximately 8% to 40%.

JD Sports said it expected the acquisition to be completed in the second half of the financial year, and praised Hibbett’s existing “very experienced and talented management team” led by chief executive officer Michael E. Longo who will continue to run the brand after the acquisition.

JD Sports CEO Régis Schultz said: “We are delighted to announce the proposed acquisition of Hibbett. This acquisition is in line with our strategic priorities and is a very important transaction for our strategic and financial development.

“Strategically, it enhances our presence within North America and achieves our objective of strengthening our Complementary Concepts division. Hibbett’s footprint is highly complementary, adding a stronger presence in communities across the southeastern US, where we currently have a limited presence. It will also provide a stronger platform for the rollout of the JD fascia in the US.

“Financially, it accelerates our growth plans within the US and is expected to be earnings accretive from year one and before potential synergies are taken into account. It will also strengthen further our key brand partner relationships in the largest sportswear market in the world.

“Hibbett has a strong and experienced management team who we look forward to working with on this transaction and beyond as we welcome Hibbett into our family of North American retail fascias.”