JD Sports has been on an acquisition frenzy, but the U.K.’s antitrust regulator is throwing up a roadblock — the company may be required to sell Footasylum after all.
Britain’s biggest sportswear retailer acquired Footasylum in April 2019 for $124 million, but the acquisition was quickly flagged, which has led to a series of appeals and investigations:
- July 2019: The Competition and Markets Authority launched an inquiry into the deal, which ended in the CMA ordering JD Sports to sell Footasylum.
- June 2020: JD Sports appealed the order.
- November 2020: The Competition Appeal Tribunal found that the original inquiry may have not looked closely enough at pandemic shopping habits, so the deal would need to be investigated further.
- On Thursday, the CMA said the company may still need to sell its rival despite the appeal.
The CMA again cited market competition problems if the companies stayed together, including a CMA survey reportedly showing that many Footasylum consumers are also JD Sports consumers.
JD Sports’ executive chairman Peter Cowgill said the company will “continue to make our case strongly to the CMA before it releases its final report” next month.
The company bolstered its portfolio by acquiring Shoe Palace for $325 million in December 2020 and DTLR Villa for $495 million in March. It also purchased Manchester-based clothing retailer Oi Polloi in May and a 60% stake in sportswear seller Marketing Investment Group in March.
As of June, JD Sports had already generated roughly $7.3 billion in revenue. The Office for National Statistics says online retails sales increased to 27.9% in July.
