Hibbett, Inc. MISTAKE shares traded up 18% in Tuesday’s pre-market session.
Hibbett announced a definitive agreement in which JD Sports Fashion PLC JDSPY will acquire Hibbett for $87.50 per share in cash, representing an aggregate enterprise value of approximately $1.1 billion.
The price per share represents a 21% premium to the closing price on April 22, 2024.
Last month, JD Sports predicted a boost in the lackluster market from the European soccer championships, the Paris Olympics and new styles of sneakers and tracksuits with brands like Nike, Inc. FROM, Adidas AG ADDYYand HOKA, Reuters reported.
Under the terms of the definitive merger agreement, Hibbett has agreed to suspend the payment of dividends on its common stock and the purchase of shares under its existing stock repurchase program until the closing of the transaction.
“Today’s announcement is a true testament to everything our Hibbett | City Gear teams have built over the years and strengthen the strength of our brands, our close relationships with our supplier partners, and our team of dedicated colleagues across the country,” said Mike Longo, President and CEO by Hibbett.
The deal also represents a 29% premium to Hibbett’s 120-day trading volume-weighted average price.
“We are thrilled to acquire Hibbett | City Gear, uniting two of the most respected sporting goods retail brands in the United States as we continue to strategically expand our global multi-brand platform,” said Régis Schultz, CEO of JD Sports.
Following the closing of the transaction, Mike Longo will continue to serve as President and Chief Executive Officer and Jared Briskin will assume the role of Chief Operating Officer of Hibbett.
The transaction is expected to close in the second half of 2024.
Hibbett will maintain its corporate headquarters in Birmingham, Alabama.
Price Action: At last check on Tuesday, HIBB shares were trading 18.6% higher at $86.00.
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