$1bn US sports giant swoops for Kitbag

HOME shopping and education supplies company Findel has completed the sale of its online sports business Kitbag to a $1bn revenue company with ambitious growth plans.

The Hyde-based company will receive £11.55m for Kitbag from a new business owned by Fanatics Inc, the US market leader for licenced sports merchandise.

Based in Chadderton near Oldham, Kitbag employs 500 people and is led by former Manchester United commercial director Andy Anson. Staff have been told it is “business as usual”, but there would be many exciting opportunities under the new ownership.

Findel said it would be using the proceeds of the sale to cut its bank debt and drive growth in its two remaining divisions, education and Express Gifts.

Executive chairman David Sugden said: “We believe that this transaction represents a good outcome for all concerned. As Kitbag builds upon its strengthened position, it will benefit from the expertise and international presence in this marketplace that Fanatics offers.

“As for Findel, this deal will strengthen our balance sheet and significantly reduce our average working capital requirement, which is consistent with our ambition to focus our resources more fully on driving growth within our core home shopping and education businesses.”

Doug Mack, CEO of Fanatics, added: “We could not be more excited to work with the Kitbag team to build upon their multi-channel capabilities, expertise in soccer and strong portfolio of partners to accelerate both our US and international growth.

“Fanatics and Kitbag are a nearly perfect complement, creating a complete platform for sports fans, leagues, teams and manufacturers globally, which will grow the licensed sports industry.”

Fanatics operates more than 300 online and offline stores, including the e-commerce business for all major US professional sports leagues – the NFL, MLB, NBA, NHL, MLS, NASCAR and PGA – as well as partnering with major media brands such as NBC Sports, CBS Sports and FOX Sports.

Based in Silicon Valley , Fanatics’  in-venue and event retail portfolio includes many marquee events and partners, including the NHL, NASCAR and the recently opened 25,000 sq ft NBA Flagship Store in New York City.

For the year ended 27 March 2015, Kitbag reported a loss before tax and exceptional items of £1.2m (2014: loss of £4.1m).

The gross assets of Kitbag as at 27 March 2015 were £33.7m.  The sale is expected to produce a marginal loss upon disposal for Findel.

Kitbag chief executive Andy Anson said: “The process of identifying the best strategic option for Kitbag has been comprehensive but it’s clear that Fanatics represents the best home for this business.

“Kitbag and Fanatics are complementary propositions. Fanatics’ focus has been to grow and develop business in the US, while the majority of Kitbag’s presence is in Europe and the rest of the world.  As a consequence, the globalisation of all the major sports we serve together creates fantastic opportunities for future growth and expansion.

“Kitbag will, in effect, be operating as the international arm of Fanatics and we will undoubtedly be a much stronger business under Fanatics’ ownership.”

Kitbag has commercial partnerships with global brands such as: Chelsea, Everton, Manchester City, Manchester United, Real Madrid, Wimbledon, The RFU, Tour de France, The NBA, The NFL and Formula1.

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