- Findel sells sports etailer Kitbag to US firm fanatics for £11.55m
- Sports Direct, which had tabled a bid for Kitbag in the past, had attempted to thwart the sale by snapping up Findel shares
- Findel has halted its search for a chief executive and decided an executive chairman is a better fit for its new, smaller business. Current incumbent David Sugden has declined the role
Findel has sold Kitbag to Fanatics, a US-licensed sports merchandise specialist, thwarting Sports Direct’s attempt to disrupt the sale.
Sports Direct, which has made failed attempts to buy Kitbag in the past, snapped up 19% of Findel’s shares late last year in an attempt to disrupt the sale of the sports etailer.
“Fanatics and Kitbag are a nearly perfect complement, creating a complete platform for sports fans”
Findel executive chairman David Sugden
Sports Direct attempted to have one of its representatives appointed to Findel’s board in December but the move was voted down by Findel shareholders.
Fanatics will pay £11.55m for Kitbag, subject to the etailer’s working capital position on completion of the deal. Kitbag reported a pre-tax loss before exceptionals of £1.2m in its year to March 27, 2015.
Findel will use the sale proceeds to reduce debt and drive growth in its other core businesses, Express Gifts and its education division.
Findel executive chairman David Sugden said: “We believe that this transaction represents a good outcome for all concerned. As Kitbag builds upon its strengthened position, it will benefit from the expertise and international presence in this marketplace that Fanatics offers.
“As for Findel, this deal will strengthen our balance sheet and significantly reduce our average working capital requirement, which is consistent with our ambition to focus our resources more fully on driving growth within our core home shopping and education businesses.”
Fanatics chief executive Doug Mack said: “We could not be more excited to work with the Kitbag team to build upon their multichannel capabilities, expertise in soccer and strong portfolio of partners to accelerate both our US and international growth.
“Fanatics and Kitbag are a nearly perfect complement, creating a complete platform for sports fans, leagues, teams and manufacturers globally, which will grow the licensed sports industry.”
As a result of the sale and the reduced size of Findel, the business has decided to end its search for a chief executive and continue with an executive chairman at the helm. However, Sugden does not want to carry on in the role so will stay until a replacement is found. Sugden has led the Findel business since former chief executive Roger Siddle departed in March last year.