Sports Direct International secures approval to acquire Eastern Outfitters’ assets
Sports Direct International (Sports Direct) has received approval of the Delaware Bankruptcy Court in the US to acquire certain assets of Eastern Outfitters.
These assets comprise the businesses of Bob's Stores and Eastern Mountain Sports pursuant to a s.363 sale process after the filing by Eastern Outfitters under Chapter 11.
This deal will result in the acquisition of approximately 50 retail stores in the US under the Bob's and Eastern Mountain store brands.
These entities predominantly sell sports and casual wear, and outdoor and camping equipment and clothing.
The aggregate cost of the acquisition to Sports Direct is around $101m in cash.
This cash has either been advanced by Sports Direct by way of debtor-in-possession and other loans to Eastern Outfitters prior to, and as part of, the Chapter 11 process, or been used by Sports Direct for the acquisition of Eastern Outfitters' debt.
In the financial period ending 28 January, the assets reported a pre-tax net operating loss of $26m. As of this date, the gross assets of the businesses being acquired by Sports Direct was $126m.
The acquisition is expected to complete in the first half of May.
The company stated the deal will provide a footprint in US bricks-and-mortar retail, and a platform to develop US online sales.
Sports Direct is a UK-based sports retailer, which also owns a portfolio of lifestyle and fashion brands apart from sports.
It currently operates around 420 sports stores and 130 lifestyle stores in the UK, as well as 270 stores in 19 European countries.
Image: A branch of Sports Direct in Bradford. Photo: courtesy of Betty Longbottom via Wikipedia.