JD Sports agrees $495m cash acquisition of North American sportswear retailer

Peter Cowgill

Sports and athleisure retailer JD Sports Fashion has agreed to pay $495m in cash for US-based DTLR Villa, a sportswear retailer based in Baltimore, Maryland.

It is currently majority owned by BRS & Co and Goode Capital.

DLTR was established in 1982 and is a hyperlocal athletic footwear and apparel streetwear retailer. Originally named Downtown Locker Room, the company later re-branded as DTLR and, in 2017, merged with Sneaker Villa Inc, previously based in Philadelphia.

DTLR currently operates from 247 stores across 19 states, principally in the North and East of the United States.

Completion of the acquisition is expected during the first quarter of 2021.

Bury-based JD Sports said around $100m of the purchase price will be used to repay existing debts of DTLR.

The cash consideration is being funded from JD’s cash resources and existing bank facilities.

The DTLR management team, headed by Glenn Gaynor and Scott Collins who will be continuing in their roles as Co-CEOs, will also be reinvesting a portion of their proceeds back into DTLR in exchange for a new minority stake of approximately 1.4%.

The acquisition of DTLR, with its differentiated consumer proposition, will enhance JD’s presence in the North and East of the US, complementing not only its existing JD and Finish Line fascias, but also the recent acquisition of Shoe Palace which is based on the West Coast.

In the 52 weeks ended February 1, 2020, DTLR delivered EBITDA of $45.6m. After recognising a charge for depreciation and amortisation of $24.7m and net funding costs of $19.3m, DTLR delivered a profit before tax of $1.6m. The gross assets in the DTLR balance sheet at February 1, 2020 were $293.7m.

JD Sports executive chairman, Peter Cowgill, said: “This is another exciting milestone in the group’s development in the United States.

“Like Shoe Palace, DTLR pride themselves on the deep connection they have with their consumers and the active role they play in the communities that they serve. As such, we intend to retain the DTLR Villa fascia and its proposition.

“The acquisition of DTLR will enhance our presence in the North and east of the United States and will be another important step in the group’s evolution.

“We look forward to closing the transaction and welcoming the DTLR team to the group.”

Close