Sports Direct has announced a deal which could result in the possible acquisition of Irish retailer Heatons.
Advertisement
Mr Ashley secured an initial agreement with minority shareholder Sandra Minor to buy a stake in Warrnambool, the holding company of Heatons.
Heatons have 44 stores across the Republic of Ireland and ten stores in Northern Ireland.
The business has also entered into a conditional put and call option agreement with Mark Heaton, Hugh Heaton, John O’Neill, Warrnambool and Katipo Limited over the remaining shares.
The blue-chip group further revealed that it had inked a conditional put and call option agreement with the remaining shareholders in Warrnambool to purchase the rest of the business.
In addition, it noted that Sports Direct sources the majority of its product from Asia in USA dollars and as such, will face a dollar sourcing headwind on own-label product from full-year 2017, which the bank expects to constrain gross margin and possibly volume growth.
Sports Direct chief executive Dave Forsey said it would step up investment in Heatons and “strengthen” the brand. For the year ended 30 April, Warrnambool had consolidated revenue of EUR219.3m, and profit before tax of EUR10m.
Sports Direct has struck a €47.5 million (£35 million) deal to snap up the 50% it does not already own in Heatons, which sells everything from women’s jackets to saucepans.
The Purchase Agreement and the conditional Option Agreement are both conditional upon merger clearance from the Irish Competition and Consumer Protection Commission being obtained.
Advertisement
Twenty-seven of the stores in Ireland have a dedicated SportsWorld section while the 10 stores in Northern Ireland either have a Sports Direct-branded section or are located next to a Sports Direct outlet.
