Britain’s leading sports retailer Sports Direct has reached agreement to assume full ownership of diversified Irish retailer, Heatons, in a €47.5m deal.
Sports Direct, founded by Newcastle United owner Mike Ashley, already owns 50% of Warrnambool, the holding company of Heatons, and has reached agreement to push that into a majority share by acquiring the unspecified minority percentage held by shareholder, Sandra Minor.
In addition, the company has signed a conditional ‘put and call’ option agreement with Warrnambool’s remaining investors, including Hugh Heaton, John O’Neill and Mark Heaton, that would result in Sports Direct gaining 100% control of the company.
The whole transaction is reliant on approval from the Competition and Consumer Protection Commission. If passed, Sports Direct has until July 2, 2017, to exercise its options.
The Warrnambool/ Heatons investment is Sports Direct’s only involvement in the Irish market, but that also includes Heatons online sports retail offering, Sportsworld.ie.
The plan, with full ownership of the company, seems likely to involve Sports Direct rebranding Heatons sports-related offering.
This would effectively see a Sports Direct shop/concession within Heatons stores, which are mainly known for homeware and clothing items.
There is a dedicated SportsWorld section in 27 of the 44 Heatons stores in the Republic, with all 15 of its stores in the North already incorporating a Sports Direct concession area.
Warrnambool also owns and operates a further five standalone Sports Direct stores across the North. The Heatons brand, itself, seems likely to be retained as part of this deal.
“We look forward to accelerating investment into the existing store portfolio and strengthening the Heatons and Sports Directs brands across Ireland,” Sports Direct’s chief executive, Dave Forsey said yesterday.
“With two years of investment and by aligning the Irish model with our UK strategy, I believe this will be an exceptional deal for our shareholders,” he said.
Latest accounts to the end of April show Warrnambool had consolidated revenues of €219.3m, gross assets of €158m, earnings before interest tax depreciation and amortisation of €17.2m and pre-tax profits of €10m.
Sports Direct, which owns brands like Slazenger and Dunlop, previously tried to boost its Irish presence via a failed bid for Elvery’s, which had entered receivership, early last year.
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