Hibbett Sports Inc., leading sporting goods retailer based in USA, has signed a definitive agreement to acquire privately held City Gear, a city speciality retailer of premium athletic footwear, apparel and accessories with 135 stores in 15 states. The latter will operate as a subsidiary of Hibbett Sporting Goods Inc., from City Gear’s current headquarters in Memphis, Tennessee, and will continue to be led by members of City Gear’s senior management team.
Terms of the transaction included consideration of US $ 88 million in cash which is to be paid at the closing and potential for upto US $ 25 million in additional consideration to be paid over the next two years, subject to certain performance-based targets. Hibbett’s expects to complete the transaction by early December, subject to customary closing conditions.
In addition to this, Hibbett will provide City Gear the needed infrastructure for future growth, including strong internal systems, omni-channel capabilities, and real estate expertise.
Mike Longo, Chief Executive Officer, City Gear, stated, “City Gear is excited to join the Hibbett team and contribute to the winning tradition they have established over the years. We believe that Hibbett provides City Gear the ideal platform to expand upon our successes in serving our loyal customers and are excited to continue to grow leveraging Hibbett’s capabilities.”
Jeff Rosenthal, President and Chief Executive Officer, Hibbett Sports Inc. said, “We are pleased and excited to announce this acquisition, which provides substantially greater scale in the athletic speciality market and is an extension of our strategy to provide high demand, branded products to under served markets. City Gear represents a key brand with the fashion-forward consumer and will allow us to extend our customer base and provide a significant opportunity for growth.”
City Gear is famous for superior customer service and a persuasive merchandise assortment that focuses on fashion-forward customers with lifestyles drawn to and driven by the “sneaker culture.” The brand has reported a total revenue of approximately US $ 190 million.
Hibbett Sports Inc., is headquartered in Birmingham, Alabama, is a leading athletic-inspired fashion retailer with more than 1,000 stores, primarily located in small and mid-sized communities across the country.
