JD Sports raises £464m to swell acquisition warchest

JD Sports

Sports and athleisurewear retailer JD Sports Fashion has riased £464m in an overnight accelerated bookbuild share placing to boost its acquisition warchest.

The Bury-based retailer announced the move just before the markets closed yesterday afternoon.

This morning it confirmed that it has placed a total of 58,393,989 new ordinary shares through Investec Bank and Peel Hunt at an issue price of 795p per share, which was a discount of approximately 2.5% to the mid-market closing price of 815p per share yesterday.

The placing shares represent approximately six per cent of the existing issued share capital of the company.

Admission of the new shares is expected next Monday, February 8.

JD explained that the placing will be used to fund future acquisitions, following the launch of its expansion strategy outside of Europe in December 2015, with a joint venture in Malaysia.

Since then, it has continued to expand its global presence, most recently and notably in the US, with the announcement earlier this week of the conditional acquisition of DTLR Villa, which follows on from the acquisitions of Shoe Palace in December 2020 and The Finish Line, Inc in June 2018.

The group’s global expansion strategy has been a major factor in the significant growth of its profit before tax and exceptional items, which has increased from £100m in the year ended January 31, 2015, to £439m in the financial year ended February 1, 2020.

The directors believe there are a number of potentially attractive acquisition opportunities that will become available in due course and which will continue to support the group’s successful global expansion strategy.

The net proceeds of the placing, in conjunction with the group’s available cash resources – net cash of £1,000m at December 2020 – and debt facilities, principally a £700m syndicated revolving credit facility in the UK which is committed to November 6, 2024, will be used to capitalise on the acquisition opportunities available and invest further in the international expansion of the group.

The Manchester office of Addleshaw Goddard advised JD Sports on its equity fundraising. The AG team was led by partner Roger Hart and included Christina McNally, Josh Nock, Nina Goodman, Saad Ali and Ben Farnworth.