Sports Direct acquires European interests

Bargain retailer Sports Direct has bought majority shares in rival sporting goods retailers in Austria and the Baltic region.

Bargain retailer Sports Direct has bought majority shares in rival sporting goods retailers in Austria and the Baltic region.

The purchases will be funded from existing cash and bank facilities and represent a continuation of the group's previously stated European expansion plans, said Chief Executive Dave Forsey.

Sports Direct has bought a 51% equity share in Austrian family owned retailer Sports Ebyl & Sports Experts (EAG) for €10.5m plus an agreed €30m investment in the business.

During the next five years, the FTSE 250 group will have the right to acquire the remaining shares in EAG for €15.5m, while the current owners also have the right to offload their remaining shares to Sports Direct for €5m.

In the Baltics, the group acquired 60% of the equity of Sportland International, the largest sporting goods retailer in the region, for an undisclosed sum.

EAG has 55 stores in Austria, three in Germany and owns 18 properties including stores and warehouses, with a combined gross assets of €166m. In the year to August 31st 2012 the retailer turned over €323.8m but lost €20.6m.

Sportland runs the Sportland, Timberland, O'Neill and Nike retail chains in Estonia, Latvia and Lithuania, as well as being the official wholesale distributor of Nike products in the Baltics.

In calendar 2012, SIG took sales of €61.6m from its 80 stores.

Forsey said: "Expected benefits from these investments include increased scale for our international business, growing international awareness of our group brands and additional expertise in specialist product categories such as winter sports.

"We are delighted to be working with strong local partners such as the Eybl Family, Are Altraja and Anti Kalle and have every confidence in their ability to grow their businesses in Austria and the Baltics."

OH

Recommended

Share tips of the week – 28 January
Share tips

Share tips of the week – 28 January

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
28 Jan 2022
Which assets will benefit as the “jam tomorrow” bubble pops?
Investment strategy

Which assets will benefit as the “jam tomorrow” bubble pops?

With tech stocks, cryptocurrencies and many other “long duration” investments crashing hard, the “jam tomorrow” bubble looks to be bursting. John Step…
24 Jan 2022
Three innovative Asian stocks to buy now
Share tips

Three innovative Asian stocks to buy now

Professional investor Fay Ren of the Cerno Pacific Fund highlights three of her favourite Asian stocks to buy now
24 Jan 2022
Share tips of the week – 21 January
Share tips

Share tips of the week – 21 January

MoneyWeek’s comprehensive guide to the best of this week’s share tips from the rest of the UK's financial pages.
21 Jan 2022

Most Popular

Shareholder capitalism: why we must return power to listed companies’ ultimate owners
Investment strategy

Shareholder capitalism: why we must return power to listed companies’ ultimate owners

Under our system of shareholder capitalism it's not fund managers, it‘s the individual investors – the company's ultimate owners – who should be telli…
24 Jan 2022
Temple Bar’s Ian Lance and Nick Purves: the essence of value investing
Investment strategy

Temple Bar’s Ian Lance and Nick Purves: the essence of value investing

Ian Lance and Nick Purves of the Temple Bar investment trust explain the essence of “value investing” – buying something for less than its intrinsic v…
14 Jan 2022
Three innovative Asian stocks to buy now
Share tips

Three innovative Asian stocks to buy now

Professional investor Fay Ren of the Cerno Pacific Fund highlights three of her favourite Asian stocks to buy now
24 Jan 2022