Hibbett is now officially one with JD Sports.
According to the athletic-inspired fashion retailer, its acquisition by JD Sports Fashion was completed on Thursday, officially closing a deal that was first announced in April.
Now that the deal is done, Hibbett is officially part of JD and will cease to be a stand-alone publicly traded company. Mike Longo will continue as president and chief executive officer of Hibbett and Jared Briskin will assume the role of chief operating officer. The company will maintain its corporate headquarters in Birmingham, Ala.
“We are excited to complete this transaction and join JD,” Longo said in a statement on Thursday. “Hibbett and City Gear will continue to have significant growth opportunities thanks to our strong vendor relationships with highly coveted brands, best-in-class omni-channel platform and efficient supply chain operations. In addition, our store footprint is complementary and incremental to the other existing JD locations in North America. Above all, we will continue to provide an outstanding consumer experience in underserved communities by offering a unique and compelling product mix that appeals to our fashion-conscious shoppers.”
British sneaker and athletics giant JD Sports Fashion announced on April 23 that it was set to acquire Hibbett as part of its efforts to dig deeper into the U.S. market.
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JD Sports said at the time that it planned to acquire 100 percent of Hibbett, which is quoted on the Nasdaq, for a price of $87.50 per share, in cash, implying an enterprise value of $1.11 billion.
JD, a FTSE 100 company that’s majority owned by Pentland Group, said it expects to fund the deal and refinance Hibbett’s existing debt through a combination of existing U.S. cash resources of $300 million and a $1 billion extension to the group’s existing bank facilities.
Régis Schultz, CEO of JD Sports Fashion Plc, said in April that the acquisition is in line with the company’s priorities and is “very important” for its strategic and financial development.
He said the deal “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 U.S., where we currently have a limited presence. It will also provide a stronger platform for the rollout of the JD fascia in the U.S.”
Schultz added that the deal 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.”
Hibbett has 1,169 stores across 36 states. Its main retail banners are Hibbett and City Gear. The chain was founded 75 years ago and sells brands including Nike, Adidas, and Jordan across footwear, apparel and accessories.
In the 53 weeks ended Feb. 3, 2024, Hibbett generated net sales of $1.7 billion, EBITDA of $186 million, and profit before tax of $131.6 million. Gross assets on the balance sheet were $909.2 million.
JD Sports said the transaction represents an important strategic milestone, accelerating growth plans in North America “and aligning with its stated strategy of enhancing its presence in the world’s biggest and most attractive sportswear market.”
The British sports giant added the transaction will also help the group to strengthen brand partner relationships, and allow for an “enhanced proposition to customers and efficiency opportunities in the region.”
Annual cost synergies are expected to be at least $25 million, according to JD.
The Hibbett deal marks JD Sports’ latest foray into the U.S. market. In 2021, it purchased two U.S. street and sneaker companies in the space of six weeks.
It bought 100 percent of DTLR Villa, an athletic footwear and apparel streetwear retailer based in Baltimore, for $495 million. That year, it snapped up the San Jose, California-based Shoe Palace, which sells brands including Nike, Champion, and Fila.
The British company has also been expanding in Europe via acquisitions. Last year, it acquired the French company Groupe Courir, a footwear and sports apparel retailer, as part of an international acquisitions drive.
