JD Sports said it had “reached [an] agreement on the terms of a recommended cash offer” which will be financed from JD’s existing cash resources and facilities. It will pay 82.5p per share, a 77.4% increase on the 46.5p closing price of Footasylum’s shares as of 15 March 2019.
The retailer bought an 8.3% stake in Footasylum in February before increasing its stake to 18%, however the sportswear retailer said it had no intentions of making an offer for Footasylum.
Footasylum has endured a “challenging” period as in its last trading update, it issued a profit warning in January despite reporting a rise in revenue.
Peter Cowgill, executive chairman of JD, said: “We are pleased to make this Offer for Footasylum, which is very complementary to our existing businesses in the UK. We believe that there will be significant operational and strategic benefits through the combination of the very experienced and knowledgeable management team at Footasylum and our own expertise.”
Barry Bown, executive chairman of Footasylum, added: “The Footasylum Board has concluded that the offer represents the best strategic option for Footasylum and its employees. It believes the offer fairly reflects Footasylum’s current market position and prospects on a standalone basis and, as such, that Footasylum Shareholders should be given the opportunity to realise value from the offer.”