GART SPORTS TO ACQUIRE OSHMAN’S
NEW YORK — In what stands to be the largest merger in the sporting goods market in recent years, Gart Sports has signed a deal to acquire Oshman’s Sporting Goods.
Once the merger is complete, Gart, a Denver-based chain, will have 178 stores in 25 states. During the four fiscal quarters ended Oct. 28, 2000, Gart and Oshman’s generated revenues of $1.1 billion.
The deal is expected to be wrapped up within the next four months, an Oshman’s spokeswoman said. Pending that approval, Oshman’s will operate as a subsidiary of Gart Sports. At this point, there are no plans to close any Oshman’s stores, a company spokeswoman said.
Oshman’s will continue to operate under its own name in areas where it has a strong retail presence, she said. Oshman’s will change the name of some of locations to Gart Sports or Sportmart where appropriate.
The combined company’s common stock will be traded on Nasdaq under Gart’s current symbol, GRTS.
Oshman’s shareholders will receive $7 cash and 0.55 shares of Gart Sports common stock for each share of Oshman’s common stock.
Executives at Gart Sports could not be reached for comment.
In recent years, retail consolidation has been a major factor with sporting goods stores, struggling to distinguish themselves in an overcrowded, overexpanded and price-driven market.
With 120 stores in 16 states under the Gart Sports and Sportmart names, Gart is the second-largest publicly traded sporting goods retailer, behind The Sports Authority, a 198-unit chain.
In January 1998, Gart Sports went public after acquiring Sportmart, a Chicago-based operation. Seven months later, Gart made a surprise bid for The Sports Authority, but the deal never materialized.
Based in Houston, Oshman’s has 58 sporting goods stores in medium-to-large metropolitan areas in the U.S., including 43 big-box units.
Oshman’s is being advised by Financo, a New York-based investment bank, and Gart Sports is taking cues from Stephens Inc. of Little Rock, Ark., and Leonard Green & Partners of Los Angeles.
“Clearly the sporting goods big-box sector is ripe for consolidation,” said William Mercer Smith, president of Financo, an investment banking firm that specializes in apparel and fashion businesses, which advised Oshman’s in the deal. “This is a very strong move. These are both very strong, dominant brands in their sector.”