JD Sports in deal to buy Footasylum for £90m

JD Sports has made an offer to purchase clothing and shoe retailer Footasylum for £90.1m.

JD Sports already owns 8% of Footasylum after buying a stake in February.

Footasylum has been going through a difficult period. In September, it warned of weaker than expected profits following poor trading over the summer. Shares more than halved after that warning, to trade at 40p.

The cash offer values each Footasylum share at 82.3p.

That is a near 80% premium on Friday’s closing price of 46.5p. Footasylum shares jumped on Monday following news of the deal.

Footasylum management has agreed to the offer, but the deal still requires shareholder approval.

JD Sports said the two businesses would complement each other. Footasylum is focused on adults aged 16-24, while JD Sports says its target audience is slightly younger.

“This consolidation of the sector shows JD Sports resilience and customer appeal in an otherwise fairly depressing retail landscape,” said Catherine Shuttleworth, chief executive of shopper marketing agency Savvy.

“By merging Footasylum into their ecosystem, this acquisition looks like a smart move.”

The two companies have a shared history, JD Sports co-founder David Makin established Footasylum in 2005.

In 2008, John Wardle, the other co-founder of JD Sports, joined Footasylum and was chief executive for seven years, before becoming executive chairman in 2015.