Hibbett Sporting Goods (HIBB) shareholders saw a significant gain in Tuesday’s premarket trading, with shares jumping 19% after JD Sports Fashion (JDSPY) proposed acquiring the sporting goods retailer for approximately $1.1 billion. The U.K.-based sportswear giant intends to acquire all outstanding shares of Hibbett, headquartered in Birmingham, Alabama, for $87.50 per share in cash. This represents a premium of 21% over the U.S. firm’s closing price on April 22, 2024.
The Hibbett board of directors has unanimously endorsed the transaction, which is expected to be finalized in the second half of 2024. Completion of the deal is contingent upon Hibbett stockholder approval and regulatory clearance. Post-acquisition, Hibbett (HIBB) will no longer be publicly traded but will retain its Birmingham headquarters. Current president and CEO Mike Longo will continue leading the business, while Jared Briskin will assume the role of chief operating officer.
During the transaction, Hibbett (HIBB) has agreed to suspend dividend payments on common stock and share purchases under its current Stock Repurchase Program. The acquisition aligns with JD Sports’ (JDSPY) strategy of expanding its global multi-brand platform and strengthening its presence in the U.S. market. Régis Schultz, chief executive officer of JD Sports, stated, ‘With Hibbett’s highly complementary footprint, this transaction is a logical next step in our strategic growth plans, further enabling us to meet the dynamic demands of consumers globally.’
As of February 3, 2024, Hibbett (HIBB) operated 1,169 specialty stores, including Hibbett, City Gear, and Sports Additions, across 36 U.S. states. The acquisition expands JD Sports’ global operations and cements its foothold in the competitive U.S. sporting goods market.
