JD Sports Fashion Plc (LSE:JD.) entered into a binding agreement to acquire Hibbett, Inc. for $1.1 billion.
April 23, 2024 at 12:00 am EDT
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JD Sports Fashion Plc (LSE:JD.) entered into a binding agreement to acquire Hibbett, Inc. (NasdaqGS:HIBB) for $1.1 billion on April 23, 2024. The Group entered into a binding agreement to acquire 100% of the outstanding share capital of Hibbett for a price of $87.50 per share in cash, implying an equity value of $1,083 million and an enterprise value of $1,109 million. The Group expects to fund the total consideration payable, and refinance Hibbett's existing debt, through a combination of existing US cash resources of $300 million and a $1,000 million extension to the Group's existing bank facilities. Under the terms of the definitive merger agreement, Hibbett has agreed to suspend the payment of dividends on its common stock, as well as the purchase of shares under its existing Stock Repurchase Program, through the closing of the transaction. Hibbett will be required to pay a termination fee of $35.2 million in case of termination and similarly, Hibbett will be entitled to receive a reverse termination fee from JD Sports of an amount in cash equal to $53.5 million.
Following the closing of the transaction, Hibbett will join the JD Sports family of athletic footwear and fashion retail brands and will cease to be a publicly traded company. The Board of Directors of Hibbett has unanimously approved the definitive merger agreement and the transaction. The board of directors of JD Sports Fashion also approved the transaction. The transaction is expected to close in the second half of 2024, subject to receipt of Hibbett stockholder approval, receipt of required regulatory approvals, and the satisfaction of other customary conditions to closing. The Transaction is subject to clearance under the US Hart-Scott-Rodino (HSR) Antitrust Improvements Act. Following the closing of the transaction, Mike Longo will continue to serve as President and Chief Executive Officer and Jared Briskin will take on the role of Chief Operating Officer of Hibbett. Hibbett will maintain its corporate headquarters in Birmingham, Alabama. JD Sports expects the transaction to be accretive in the first full year of ownership.
Solomon Partners Securities, LLC is serving as financial advisor and fairness opinion provider for Hibbett, and Ryan D. Thomas, Scott W. Bell, Emily A. Burrows, Lymari Martinez Cromwell, Michael G. Dashefsky, Alexandria Wood Davenport, Curtis L. Fisher, Philip M. Lewis, Lucas Ross Smith of Bass, Berry & Sims PLC is serving as its legal counsels. Baird and Rothschild & Co are serving as financial advisors to JD Sports, and Paul Tiger, Tomas Rua, Claire Wills, Andrew Hutchings, Additional team members, all based in the U.S., included Lori Goodman, Meghan Rissmiller, Laura Onken, Jeremiah Nelson, David Perry, Kyle Lakin, Mena Kaplan, Christine Lyon, Brock Dahl, Claude Stansbury and Stephanie Brown Cripps of Freshfields Bruckhaus Deringer LLP serving as its legal counsels. Martin O'Shea of Addleshaw Goddard acted as legal advisor to JD Sports Fashion Plc.
JD Sports Fashion Plc is a United Kingdom-based multichannel retailer of sports, fashion and outdoor brands. The Company specializes in the sale of sports fashion and outdoor footwear and apparel, combining global brands such as Nike, adidas, Puma and The North Face, with own brand labels such as Pink Soda and Supply & Demand. The Company's segments include Sports Fashion and Outdoor. Its sports fashion brands include JD, Size?, Footpatrol, Finish Line, Shoe palace, DTLR, Livestock, Sprinter, Sport Zone, Perry Sport and Sizeer. Its outdoor brands include Go Outdoors (GO), Blacks, Millets, Tiso, Ultimate Outdoors, Fishing Republic and Naylors. Its Finish Line is a retailer of multi-branded athletic footwear, apparel and accessories in the United States. Shoe Palace is a retailer of branded sports footwear and apparel located on the West Coast of the United States and has over 160 stores, which trade under the Shoe Palace banner.