After months of speculation about Finish Line Inc.’s future, the retailer is selling itself to European athletic retail giant JD Sports Fashion PLC in a $558 million deal.
JD Sports will acquire 100 percent of the issued and outstanding Finish Line shares at a price of $13.50 apiece in cash. (Pentland Group is the majority owner of JD Sports, which operates more than 1,300 sports, fashion and outdoor stores across 12 countries.)
“Finish Line has long admired JD and their commitment to serve customers with premium brands through a unique and innovative retail experience,” said Sam Sato, CEO of Finish Line. “We are thrilled to partner with them and look forward to realizing the impact we will have on the marketplace together.”
For JD Sports, the deal gives the European retail powerhouse a major foothold in the U.S. market, with a brick-and-mortar and online presence.
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“We are extremely excited to be joining up with Finish Line, a well-established U.S. operator,” said Peter Cowgill, executive chairman of JD. “The acquisition represents an excellent opportunity for JD to establish its market-leading multibrand proposition in the world’s largest athleisure market. It immediately offers a major presence in the U.S., a clear next step to further increase our global scale.”
For Finish Line, which has been struggling to compete with Foot Locker and other athletic goods sellers, the backing of one of Europe’s most successful retailers could help reposition it to compete more effectively.
“The special committee appointed by the Finish Line board recommended, and the board voted unanimously to approve, entering into this merger agreement,” said Bill Carmichael, chairman of the committee and lead director of the Finish Line board of directors. “With JD, Finish Line achieves immediate value for its shareholders and moves into a stronger position to compete as part of a global enterprise that leads in our industry.”
The move comes a few months after reports surfaced that the company was in talks to sell itself to U.K.-based Sports Direct International PLC, a competitor of JD Sports.