Sports equipment manufacturers Athletic and Sports Direct have announced an agreement that will see the company acquire the Sports Equipments company for an undisclosed sum.
The acquisition is expected to be completed by the end of the year and will allow Athletices to focus on developing and launching its new range of products.
The Athletiques purchase is a significant step forward for the company, which has been plagued by underperformance and has been struggling to generate sales.
Athleticals shares have fallen more than 45 per cent this year, while the company’s shares are trading below $1,200 a share.
The company has been in financial trouble for years, with sales falling by more than a third in 2017.
The deal also brings Athleties to Canada and provides an attractive opportunity to continue to expand its business across the country, according to Athletiers president and chief executive officer Andrew Tarrant.
“This acquisition gives us the ability to expand our operations in Canada while continuing to grow our business here at Athletis, and this will enable us to deliver even more value to our customers in Canada,” he said in a statement.
Athletics also announced plans to sell its Canadian operations to a company that is based in the United Kingdom.
The sale is expected in the fourth quarter of 2021.
The announcement came a day after Athletix and Sports Authority announced a deal that would see Athletica become a wholly-owned subsidiary of Sports Authority.
This deal is expected later this year.
The move by Athletys to focus its operations in Canadian markets comes after Athlete’s World, the company that makes its products in Canada, announced a $20 million round in May.
Athanos plans to invest $10 million to expand the Athlete-branded product range, including a new line of high-performance sports shoes, and add an athletic apparel business, Athlete Sports, that will focus on apparel and accessories for athletes.
The sale of AthleteSolutions to Athlete International Inc. is expected soon, according a person familiar with the matter.
The stock is down more than 11 per cent so far this year due to the recent slump in Athlete sales.