British sportswear giant JD Sports is making a major push into the US market with a $1.1bn acquisition of American athletic apparel retailer Hibbett Inc. 

This deal strengthens JD Sports' position as a global leader in sports fashion and significantly expands its presence in the US, a key growth market.

The acquisition of Hibbett, which boasts over 1,100 stores across 36 US states, will give JD Sports a coast-to-coast presence in the country.

This strategic move complements JD Sports' existing US holdings, Shoe Palace on the West Coast and DTLR on the East Coast, creating a truly national network.

The combined entity is expected to generate £4.7bn in revenue from North America alone, pushing the region's contribution to JD Sports' total sales from 32% to 40%. This significant growth is a major win for the company's ambitious expansion plans.

Under the terms of the deal, JD Sports will pay $87.50 per share for Hibbett, representing a 20% premium over its pre-acquisition price.

The acquisition is expected to be finalised in the latter half of 2024 and is projected to be earnings-positive for JD Sports in the first year of ownership.

Additionally, the deal is expected to generate cost savings of at least $25m annually.

Following the acquisition, Mike Longo will remain CEO of Hibbett, ensuring continuity and leveraging his expertise in the US market. This leadership structure signifies JD Sports' commitment to a smooth integration and continued success for both companies.

This acquisition reflects JD Sports' aggressive expansion strategy, propelled by a string of acquisitions in recent years. While the deal strengthens JD Sports' market share in the US, it also raises questions about the company's reliance on acquisitions for growth instead of organic expansion.

However, JD Sports' partnership with major sportswear brands like NIKE and adidas positions it well to capitalise on the growing demand for athletic apparel and footwear, particularly as the summer sporting season approaches with major events like the Olympics and Euro 2024.

The acquisition of Hibbett marks a significant step for JD Sports in its quest to become a dominant force in the global sportswear market, solidifying its position as a key player in the ever-evolving US retail landscape.