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British Retailer JD Sports to Buy US Rival Hibbett for $1.08 Billion

FILE PHOTO: JD Sports logo is seen on the exterior of a store in London, Britain, November 17, 2021. REUTERS/May James/File Photo
FILE PHOTO: JD Sports logo is seen on the exterior of a store in London, Britain, November 17, 2021. REUTERS/May James/File Photo
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British Retailer JD Sports to Buy US Rival Hibbett for $1.08 Billion

FILE PHOTO: JD Sports logo is seen on the exterior of a store in London, Britain, November 17, 2021. REUTERS/May James/File Photo
FILE PHOTO: JD Sports logo is seen on the exterior of a store in London, Britain, November 17, 2021. REUTERS/May James/File Photo

JD Sports Fashion has proposed to buy American athletic-fashion retailer Hibbett Inc for about $1.08 billion, the companies said on Tuesday, as the British sportswear retailer expands across the southeastern US.
JD Sports, Britain's largest sportswear retailer, will pay $87.50 per Hibbett share in cash, representing a premium of about 20% to the US firm's last closing price.
The Bury, Greater Manchester-based company said it expects to fund the deal and refinance Hibbett's existing debt through its existing US cash resources of $300 million and a $1 billion extension to its existing bank facilities.
The enlarged group would have combined revenues of about 4.7 billion pounds ($5.80 billion) in North America, JD Sports said, adding that the region's contribution to total sales would increase to about 40% from the current 32%.

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Fashion

Kering Posts 11% Drop in Q2 Sales, Sees Weak Second Half

The logo of luxury brand Gucci is seen in Tokyo on June 22, 2021. (AFP)
The logo of luxury brand Gucci is seen in Tokyo on June 22, 2021. (AFP)
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Kering Posts 11% Drop in Q2 Sales, Sees Weak Second Half

The logo of luxury brand Gucci is seen in Tokyo on June 22, 2021. (AFP)
The logo of luxury brand Gucci is seen in Tokyo on June 22, 2021. (AFP)

Kering reported a bigger-than-expected drop in second-quarter sales and forecast a weak second half, as the French luxury group struggles to revive its key label Gucci and worries grow about a prolonged downturn in high-end spending.

Sales at the French luxury group which owns labels Gucci, Boucheron and Balenciaga, fell to 4.5 billion euros ($4.9 billion), an 11% drop on an organic basis, which strips out currency effects and acquisitions.

The figure was below analyst expectations for a 9% drop, according to a Visible Alpha consensus.

It also said second-half operating income could fall by around 30%, following a 42% drop in the first half.

Sales at Gucci fell 19%, showing no improvement from the first quarter, and below analyst expectations for a 16% decline, according to a Visible Alpha consensus.

Kering has been revamping Gucci, the century-old Italian fashion house which accounts for half of group sales and two-thirds of profit.

Minimalist designs from new creative director Sabato de Sarno, which began trickling into stores earlier this year, are key to the design reset and push upmarket, in a bid to cater to wealthier clients who are more immune to economic headwinds.

Kering chief financial officer Armelle Poulou told reporters that the designs had been well received and the rollout was on track.

But the efforts have been complicated by a downturn in the global luxury market, while China's rebound - traditionally Gucci's most coveted market - was clouded by a property crisis and high youth unemployment as Western markets came down from a post-pandemic splurge.

Earnings from sector bellwether LVMH on Tuesday missed expectations as sales rose 1%, offering few signs that a pickup is around the corner, sending shares in luxury goods companies down on Wednesday. Kering traded at its lowest level since 2017.