Hibbett Sports, Inc., a U.S.-based athletic speciality retailer, announced that it has signed a definitive agreement to acquire privately held City Gear, an athletic footwear retailer.
Terms of the transaction include consideration of $88 million in cash to be paid at closing and the potential for up to $25 million in additional consideration paid over the next two years, subject to certain performance-based targets. Hibbett will finance the initial purchase through available cash along with funds from its credit facilities.
City Gear 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.
Hibbett expects to complete the transaction by early December 2018, subject to customary closing conditions. For the last fiscal year ended February 4, 2018, City Gear reported total revenue of approximately $190 million.