JD to sell Canterbury to shareholder Pentland
RETAILER JD Sports Fashion, the plans to sell its Canterbury rugby brand to Pentland Group. its largest shareholder, for £22.7m.
Bury based JD said it was buying the ONETrueSaxon clothing and footwear brand, from London based Pentland, which holds 57.47% of its shares.
Due to the close relationship between the two parties, shareholders will have to approve the deals at a meeting next month. Pentland has agreed not to take part in the vote, JD said.
Explaining the rationale behind the deals, JD’s executive chairman Peter Cowgill, said: “Having reviewed the options for Canterbury, we are pleased to have agreed its sale to Pentland on terms which are attractive for JD and provide Pentland with the opportunity to further build and develop the Canterbury brand.
“Acquiring the ONETrueSaxon brand will allow us to leverage our in-house expertise and offer new products through our core retail fascias.”
Addleshaw Goddard corporate partner Roger Hart is advising JD on the transactions.
Pentland is paying £1 for Canterbury’s shares and £22,698,520 for its debt.
JD will use the proceeds to support additional investment in its core retail business and working capital.
With a heritage in New Zealand and its European head office in Stockport Canterbury is one of the world’s largest rugby brands, distributing both technical and lifestyle products.
It is the current kit partner of the international rugby union teams of South Africa and Scotland and recently secured a long-term partnership to become the official kit partner to the Rugby Football Union.
In the year to the end of January Canterbury made a consolidated operating profit of £0.4m and a loss before taxation of £1.1m. As at 28 January 2012, Canterbury had gross assets of £32.6m.
JD said that post its Janauary acquisition of Blacks, it considers it is in the group’s best interests to sell Canterbury for a number of reasons including the fact that it will sellonly a small amount of Canterbury stock in its stores.
It will therefore allow the future potential of Canterbury to be realised and JD to focus on its retail operations and those brands within its distribution division which support the core retail proposition.
Commenting on the deal Addleshaw Goddard’s Roger Hart said: “In a challenging retail landscape, savvy retailers are reviewing their portfolios to ensure that they are supporting the core strategic needs of their business and their brands.
“The deal provides the opportunity to maximise the growth potential of two brands, whilst supporting the strategic aims of JD and Pentland – and, in today’s market, it is great to see this type of activity getting over the line.”
