Proactive Investors - Hibbett Inc (NASDAQ:HIBB) shareholders woke up to a nice surprise on Tuesday as shares in the sneaker retailer surged 19% on a takeover offer from London-listed rival JD Sports.
JD, which also bought US-based Finish Line in 2018, Shoe Palace in 2020 and DTLR Villa in 2021, is offering US$1.11 billion to purchase the US sports retailer and had entered into a binding agreement with the board to purchase all Hibbet’s shares.
Valued at US$87.50 per share, the FTSE 100 group’s offer implies a value of US$1.08 billion when excluding debt.
When trading started in New York, Hibbett jumped to around US$86 per share, having closed on Monday at US$72.49.
Hibbett boasts an estate of 1,169 stores spread across 36 US states, all of which trade as either the core business or its lifestyle brand City Gear.
Analyst Russ Mould at AJ Bell said: “UK retailers haven’t always fared too well in the States but JD’s 2018 acquisition of Finish Line has proved a rare success story.”
This was then built upon when JD Sports announced a US$325 million deal for Shoe Palace a few years later.
“Time will tell if this was the right use of capital over and above further returns to shareholders or buying back stock after a difficult period for the share price,” Mould added.