JD Sports completes Iberian JV deal
Sports fashion retailer JD Sports has exchanged contracts to combine its existing business in Spain and Portugal with one of the largest sports retailers in the region.
The deal, first announced in March, will see it combine JD Sprinter Holdings, its Spanish and Portugese business, with the Sport Zone business of Sonae, a Portuguese based multinational corporation that manages a portfolio of businesses across a range of sectors.
They have an estimated combined turnover of more than €450m and a store network of 311 stores (204 of which are in Spain and 107 are in Portugal).
The Bury-based company will also purchase shares in JD Sprinter Holdings from the investment vehicle for the current minority family shareholder.
The existing management team of JDSH is led by the Segarra family who it says have been instrumental in the success of the JD Spain and Sprinter businesses over the past five years.
Following completion, JDSH will have as shareholders JD, Sonae and Balaiko with shareholdings of approximately 50%, 30% and 20%, respectively.
Peter Cowgill, executive chairman of JD Sports said: “Sport Zone is very complementary to our existing businesses in Iberia. We believe there are significant opportunities for synergies to be created to improve operational efficiencies and profitability through the combination of the very experienced and knowledgeable management team at Sport Zone and our own expertise as we continue to strengthen JD’s presence in Europe.”
JD Sports posted another record half year result earlier this week, with pre-tax profits up 33%, as its outdoor business posted a positive half year profit for the first time.
It increased its half year pre-tax profits to £102.7m on a turnover of £1.37bn for the half year to July 29.
This continued strength is being complemented the group’s international growth – it opened 23 stores across mainland Europe, as well as its first in Australia.
Roger Hart of Addleshaw Goddard advised JD Sports on the transaction.